Senate Bill 31 Summary

• Allows cities and towns (except Indianapolis) to adopt a municipal income tax up to 1% on residents, regardless of where they work, with revenue deposited in the municipality's general fund for any general fund purpose.

• Requires municipal income tax to be re-adopted every four years through a ratification ordinance, with adoption deadlines between March 31 and August 1 for October 1 implementation.

• Authorizes counties, cities, and towns to adopt a local option sales tax on tangible personal property delivered within their geographic boundaries, with revenue usable for any lawful purpose and re-adoption required every four years.

• Establishes Department of State Revenue databases for local sales tax data including boundary changes, tax rates, and ZIP code jurisdictions in compliance with the Streamlined Sales and Use Tax Agreement.

• Adds both new taxes to the list of revenues available for debt service capture and allows municipalities to establish rainy day funds using surplus revenue from these taxes.