ELKHART, Ind. (WNDU) – A wheel tax ordinance is moving to a second reading before Elkhart City Council after a 2025 Indiana General Assembly law required cities to implement a local wheel tax in order to access annual state funding.<\/p>\n
City officials said a majority of vehicle owners would not see a change in the amount they pay. If adopted, the revenue would be received by the city rather than passing through the county.<\/p>\n
What the change would mean for drivers<\/p>\n
Elkhart has collected a wheel tax since 2019 and a surtax since 2015. Most vehicle owners currently pay a $25 fee that the state requires to pass through the county \u2014 a cost city leaders said would remain the same for most vehicles.<\/p>\n
\u201cElkhart County residents, when they register their vehicle with the BMV, pay a county surtax or wheel tax that goes to help maintain our roads,\u201d said Megan Erwin, chief of staff for the City of Elkhart.<\/p>\n
Commercial vehicles may see an increase, with the wheel tax moving up to $40. The county currently charges $10\u2013$35 for commercial vehicles. Erwin said commercial vehicles represent only 10% of all vehicle registrations.<\/p>\n
State funding tied to local adoption<\/p>\n
The change would affect one line on a vehicle registration but would unlock state funds for local road maintenance and infrastructure improvements.<\/p>\n
\u201cThe only reason that we are doing this is because the state legislature required that if we wanted to capture a portion of funding that they have for road maintenance for us they are requiring that the city adopt the wheel tax,\u201d Erwin said.<\/p>\n
Last night, the Indianapolis City-County Council approved an increase to vehicle taxes in Marion County.<\/p>\n
Elkhart officials said the ordinance will go before City Council for a second and third hearing on July 27. The city has until Sept. 1 to make a decision.<\/p>\n
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