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INDIANAPOLIS — The Indiana Senate Republicans are proposing a bill for the upcoming special session that will throw out Governor Eric Holcomb’s proposed $225 taxpayer refund and instead offer Hoosiers a six-month suspension on sales tax on residential utilities.

This suspension would include the 7% sales tax on electricity, water, gas, internet and phone bills.

“We have had ongoing discussions about what the best way is to provide relief to Hoosiers in this environment of high inflation,” said Senate Bill 3 author Sen. Travis Holdman (R-Markle).

“By suspending the 7% sales tax on residential utilities, we can provide relief to nearly every Hoosier, with an estimated statewide savings of $260 million. This concept would benefit more people than the proposed taxpayer refund, and all of the savings would go to Indiana households.”

The proposal to do away with the proposed $225 inflation relief checks to Hoosiers comes just one day after Holcomb urged lawmakers to act quickly in getting financial relief to Hoosiers. While many Hoosiers are still waiting for their initial $125 Automatic Taxpayer Refund, Holcomb proposed agreeing to his second check of $225 could mean Hoosiers getting both payments at once in August.

Some House Republicans had supported Holcomb’s proposal including State Rep. Sharon Negele (R-Attica) and House Speaker Todd Huston (R-Fishers) who pointed to Indiana’s strong position due to the state’s surplus to be able to provide the proposed inflation relief in the form of a second round of taxpayer refunds.

State Sen. Fady Qaddoura (D-30) even called for larger relief checks, proposing $400 second payments instead of $225.

Ultimately, Indiana Senate Republicans decided to axe a second payment to Hoosiers completely, instead taking aim at relief in the form of suspending the sales tax on residential utilities for six months.

The bill said it would “require power subsidiary or person that furnishes or sells the services to provide each customer on the customer’s billing statement a notice that the states sales tax that otherwise would be applied is not applied.”

Senate Bill 3 also proposes a cap on sales tax for gasoline at 29.5 cents a gallon that would be in effect through June 30, 2023.

The bill would also suspend an increase of gas tax and special fuel tax effective through June 30, 2023. The policy is said to reduce the gas tax by one cent per gallon and the special fuel tax by two cents per gallon.

In conjunction with the cap on sales tax for gasoline, the Republican said “this change means the total taxes drivers pay at the pump cannot increase for the rest of the fiscal year, regardless of how high gas prices get.”

Other inclusions in Senate Bill 3 would be providing a $400 million pay-down to the pre-1996 Teacher’s Retirement Fund, which currently has an unfunded liability of $9.8 billion.

The bill also proposes $215 million to help fund capital projects that were included in the 2021 budget that haven’t yet moved forward due to increasing construction costs.

The special session where lawmakers will present Senate Bill 3 and other bills, including a ban on abortion with some exceptions, is set for July 25.