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State budget writers added a sales tax exemption for feminine hygiene products and adult diapers in their proposal that passed the House last week.
Indiana is one of 20 states that currently tax such feminine products, according to the Alliance for Period Supplies. The rest of the states have already exempted these items or don’t have a sales tax at all.
Starting July 1, Hoosiers would be able to buy adult diapers and feminine products—including tampons, pads, panty liners, menstrual cups and other period-related items—without the 7% state sales tax. The state already exempts baby diapers.
With the exemption, a Hoosier would save 56 cents on an $8 box of tampons. For a $15 package of incontinence underwear, they would save about $1.05.
The budget bill’s fiscal analysis anticipates missing out on $11.1 million in potential revenue from the exemptions in 2026. The state brought in $10.3 billion in sales tax revenue in 2024.
The language is included in the back pages of what has been a tighter-than-usual budget bill. Lawmakers have had to contend with rising Medicaid prices and the easing of pandemic-era revenue surges, leaving them with slimmer margins to fund priorities.
The decision to add this language comes as Rep. Jeff Thompson, R-Lizton, and House lawmakers agreed to strip the budget of Gov. Mike Braun’s estimated additional $700 million in state income tax credits and sales tax holidays.
The language is adopted from a bill filed by Rep. Mark Genda, R-Frankfort. His bill died after it failed to be called up in committee.
“By eliminating the sales tax on these necessary items, I’m hoping we can ease some financial stress for Hoosiers,” Genda said in a news release. “This is a common-sense, bipartisan provision to help Hoosiers and I’m pleased it was included in the House budget.”
Lawmakers on both sides of the aisle have advocated for this exemption for years. Legislation came close to passing last year but was yanked on the final day. House Speaker Todd Huston, R-Fishers, told reporters at the time they’d consider the measure during this year’s budget.
The budget bill will likely be introduced in the Senate next week and sent to the Appropriations committee.
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