LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 7153 NOTE PREPARED: Jan 3, 2025
BILL NUMBER: HB 1596 BILL AMENDED:
SUBJECT: Richmond Food and Beverage Tax.
FIRST AUTHOR: Rep. Barrett BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
DEDICATED
FEDERAL
Summary of Legislation: This bill authorizes the city of Richmond to impose a food and beverage tax.
Effective Date: July 1, 2025.
Explanation of State Expenditures: The city of Richmond’s food and beverage tax would be collected
and remitted to the Department of State Revenue (DOR) in the same manner as Sales Tax. The DOR should
be able to implement the bill's requirements within existing levels of staff and resources.
Explanation of State Revenues:
Explanation of Local Expenditures: The city of Richmond could potentially incur a one-time increase in
costs if it holds an additional public hearing to discuss a proposed ordinance to impose a food and beverage
tax.
If the city imposes a food and beverage tax, the city fiscal officer would establish a food and beverage tax
receipts fund, in which all revenue from the tax would be deposited. Money in this fund may only be used
for the following purposes:
•To promote and encourage conventions, visitors, and tourism within the city.
•To promote and encourage economic development within the city.
•Parks and recreation, including trails.
•Activation of the Whitewater Gorge.
•The pledge of money under IC 5-1-14-4 for bonds, leases, or other obligations incurred for a purpose
described above.
Explanation of Local Revenues: The bill authorizes the city of Richmond to impose a food and beverage
tax a rate not to exceed 1% of gross retail income from food and beverage transactions in the city. If the city
adopts an ordinance to impose the tax in July 2025, the tax would be effective in September 2025, and
collections would likely begin in October 2025. The Richmond food and beverage tax expires on July 1,
HB 1596 1 2050. The following table shows the estimated potential revenue for CY 2025 through CY 2027.
Estimated Potential City of Richmond Food and Beverage Tax Revenue, 1%
CY 2025 CY 2026 CY 2027
$224,000 $900,000 $910,000
These estimates are based on employment data for the food services industry in Wayne County, as reported
in the 2023 Quarterly Census of Employment and Wages, and data from counties that currently impose food
and beverage taxes. A portion of the county total was allocated to Richmond based on the city's estimated
share of the food and beverage industry in the county.
State Agencies Affected: Department of State Revenue.
Local Agencies Affected: City of Richmond.
Information Sources: Legislative Services Agency, Indiana Handbook of Taxes, Revenues, and
Appropriations, FY 2024. OFMA Quarterly Census of Employment and Wages Data.
Fiscal Analyst: Abdulrahman Abdulkadri, 317-232-9852.
HB 1596 2