United States
Cost of living in Indiana
Cost of living in Indiana measures at 93.3, placing it 7 percent below the US average of 100 and 34th nationally. Indiana operates one of the simplest income tax structures in the country: a flat 3 percent rate for 2025, scheduled to fall further to 2.95 percent in 2026. However, counties levy their own separate income taxes on top of the state rate, which varies across jurisdictions and can add meaningfully to the headline figure. The state sales tax is 7 percent with no local additions, one of the higher flat sales tax rates nationally. For households comparing Indiana to its immediate neighbors, the income tax picture is significantly more favorable than Illinois (flat 4.95 percent) or Ohio (up to 3.5 percent with county levies) for most earners. The Indianapolis metro anchors the state economically, and its housing market is more expensive than the statewide average, though still well below most major metros nationally.
Price level
93.3
US = 100
National rank
34th
of 51, dearest first
Income tax
3%
flat
Sales tax
7%
state base rate
What your salary is worth in Indiana
Because prices here sit at 93.3 against the national 100, the same paycheck stretches differently than it would elsewhere. These figures hold buying power constant: the salary listed is what you would need in Indiana to live as you would on the reference amount in another place.
| Same lifestyle as | $60,000 | $100,000 |
|---|---|---|
| US average | $55,980 | $93,300 |
| California (dearest) | $50,569 | $84,282 |
| Arkansas (cheapest) | $64,419 | $107,365 |
Compare Indiana with anywhere in the US
To live the same in California you need
$83,055
to match $70,000 in Indiana
Price level, US = 100
The equivalent salary keeps your purchasing power constant: it is your pay scaled by the ratio of the two price levels. Regional Price Parities measure what a fixed basket of goods and services costs locally. Source: U.S. Bureau of Economic Analysis, 2024.
Indiana in context
Indiana's affordability is driven by low to moderate housing costs across the majority of its geography. Fort Wayne, South Bend, Evansville, and smaller mid-state cities all show median home prices well below the national average, making Indiana one of the more accessible states for first-time buyers. The statewide 7 percent sales tax, collected uniformly without local variation, is straightforward but applies to most goods and adds a notable consumption cost layer. County income taxes, which vary from roughly 0.5 percent to over 3 percent depending on location, mean that the true income tax rate a resident pays depends significantly on their county of residence. For lower and middle earners, the low flat state income tax combined with affordable housing typically results in a favorable total cost position. The state suits manufacturing workers, healthcare professionals, and families seeking homeownership in a stable, mid-size city environment.
The closest state above Indiana on price is South Carolina at 93.7. Just below sits Ohio at 92.8.
Frequently asked questions
Is Indiana expensive to live in?
Indiana sits at a price level of 93.3 where the US average is 100, so a typical basket of goods and services costs about 7% less than the national norm. That ranks it 34th most expensive of 51 states. Housing is usually the largest single driver of the gap.
What salary do you need in Indiana?
To match the buying power of $60,000 earned at the US average, you would need about $55,980 in Indiana. The figure scales with the price level: a place dearer than average needs more, a cheaper one needs less. Your own number also depends on housing choice and household size.
How much tax does Indiana charge?
Indiana applies a flat 3% state income tax and a base state sales tax of 7%. Flat 3.00% for 2025 (scheduled to drop to 2.95% in 2026). No state standard deduction (Indiana uses exemptions, not a standard deduction). Counties levy separate local income taxes. No local sales tax. Local jurisdictions can add their own sales tax on top.
Cost of living in other states
Price levels are Regional Price Parities from the U.S. Bureau of Economic Analysis, Regional Price Parities (SARPP, MARPP), 2024 (public domain). State tax figures are the latest published rates from state revenue departments. All figures are estimates for general comparison and not financial advice; your own costs depend on housing, household size and lifestyle.