Hoosier lawmakers are urging Governor Mike Braun to permit farmers to use tax-exempt off-road diesel fuel in their semi-trucks for the current harvest season, a move intended to alleviate the burden of record diesel prices. State Representative Jim Pressel, a Republican from Rolling Prairie, sent a letter to Governor Braun on Tuesday, requesting that farmers be allowed to utilize the untaxed fuel, often referred to as red or dyed diesel, in their semi-trucks through January 1.
The proposal comes as diesel fuel prices reached a record average of $6.92 per gallon in September. Off-road diesel is typically used for tractors, bulldozers, portable generators, and other equipment not operated on public roadways, making it exempt from certain taxes. Pressel’s letter was co-signed by 51 other lawmakers, including House Speaker Todd Houston, indicating broad support for the measure among state legislators.
Pressel communicated that "Our offices have heard ongoing concerns from farmers across Indiana about diesel fuel costs and the impact those expenses are having on agricultural operations." He underscored that farmers have been "forced to bear the full price of diesel while also dealing with the pressures that prompted the state’s emergency action" which saw tax suspensions for other motorists.
Governor Braun previously used an obscure law to declare an energy emergency in April, suspending Indiana’s gasoline use tax. He extended this relief the following month by lifting the state’s gasoline excise tax, a move that received the unofficial blessing of state lawmakers. Both gasoline taxes remain suspended through at least October 6. Braun is expected to announce as early as this week whether he will renew the suspension for another month.
However, the Governor has not extended similar relief to diesel fuel. The state’s diesel tax stands at 64 cents per gallon, in addition to other sales taxes. Braun has previously stated that most diesel users are companies rather than regular Hoosier motorists, which he offered as a reason for not suspending the diesel tax.
Despite the approximately 60-cents-per-gallon savings from the suspended taxes, the average cost for a gallon of regular gasoline in Indiana was $3.85 on Tuesday, according to AAA. In contrast, the average cost of diesel on the same day was $6.86 per gallon.
Pressel argued in his letter that if the state can offer temporary relief to motorists during times of high fuel prices, it should ensure that farmers, who play a vital role to our state, are not left without similar support.
