Fuel taxes in the United States

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The United States federal excise tax on gasoline is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel.[1][2] On average, as of October 2015, state and local taxes add 30.3 cents to gasoline and 30.0 cents to diesel, for a total US average fuel tax of 48.7 cents per gallon for gas and 54.4 cents per gallon for diesel.[3]

State taxes[edit]

Gas tax by state, with border differences highlighted.

The first US state tax on fuel was introduced in February 1919 in Oregon.[4] It was a 5¢/gal (1.3¢/L) tax. In the following decade, all of the U.S. states (48 at the time), along with the District of Columbia, introduced a gasoline tax. By 1939, an average tax of 3.8¢/gal (1¢/L) of fuel was levied by the individual states.

The table below includes federal, state and local taxes. The American Petroleum Institute uses a weighted average of local taxes by population of each municipality to come up with an average tax for the entire state. Similarly, the national average is weighted by volume of fuel sold in each state. Because the states with the highest taxes also have higher populations, more states have below average taxes than above average taxes.

Taxes on gasoline and diesel for transportation by U.S. state in U.S. cents per gallon as of July 2015[5]
State Gasoline tax
(includes federal tax of 18.4¢/gal)
Diesel tax
(includes federal tax of 24.4¢/gal)
US (Volume-Weighted) Average 48.88 54.50
Alabama 39.27 46.25
Alaska 30.65 37.15
Arizona 37.40 51.40
Arkansas 40.20 47.20
California 60.75 63.78
Colorado 40.40 44.90
Connecticut 59.26 74.70
Delaware 41.40 46.40
District of Columbia 41.90 47.90
Florida 54.82 58.07
Georgia 51.02 60.58
Hawaii 63.50 66.36
Idaho 50.40 56.40
Illinois 54.39 61.03
Indiana 54.04 67.29
Iowa 50.40 57.90
Kansas 42.43 50.43
Kentucky 44.40 47.40
Louisiana 38.41 44.41
Maine 48.41 55.61
Maryland 50.50 57.25
Massachusetts 44.94 50.94
Michigan 54.39 55.78
Minnesota 47.00 53.00
Mississippi 37.18 42.80
Missouri 35.70 41.70
Montana 46.15 52.90
Nebraska 45.40 50.80
Nevada 52.5 52.96
New Hampshire 42.23 48.23
New Jersey 32.90 41.90
New Mexico 37.28 47.28
New York 64.39 69.50
North Carolina 54.40 60.40
North Dakota 41.40 47.40
Ohio 46.40 52.40
Oklahoma 35.40 38.40
Oregon 49.47 54.74
Pennsylvania 70.00 89.70
Rhode Island 52.40 58.40
South Carolina 35.15 41.15
South Dakota 48.40 54.40
Tennessee 39.80 42.80
Texas 38.40 44.40
Utah 42.91 48.91
Vermont 49.21 56.40
Virginia 40.73 50.43
Washington 62.90 68.90
West Virginia 53.00 59.00
Wisconsin 51.30 57.30
Wyoming 42.40 48.40

Federal taxes[edit]

The first federal gasoline tax in the United States was created on June 6, 1932 with the enactment of the Revenue Act of 1932 with a tax of 1¢/gal (0.3¢/L). Since 1993, the U.S. federal gasoline tax has been 18.4¢/gal (4.86¢/L). Unlike most other goods in the US, the price displayed includes all taxes, as opposed to inclusion at the point of purchase.

Then-Secretary of Transportation Mary Peters stated on August 15, 2007 that about 60% of federal gas taxes are used for highway and bridge construction. The remaining 40% goes to earmarked programs.[6] However, revenues from other taxes are also used in federal transportation programs.

Federal tax revenues[edit]

The federal gasoline tax raised $25 billion on gasoline in 2006.[7] The tax was last raised in 1993, and is not indexed to inflation. The inflation rate from 1993 until 2015 was 64.6 percent.[8]

Public policy[edit]

Some policy advisors believe that an increased tax is needed to fund and sustain the country's transportation infrastructure. The National Surface Transportation Infrastructure Financing Commission issued a detailed report[9] in February 2009. However, much of the gas tax revenue is diverted to other government programs and debt servicing unrelated to transportation infrastructure. [10]

An increased cost of fuel would also encourage less consumption and reduce America's dependence on foreign oil. Americans sent nearly $430 billion to other countries in 2008 for the cost of imported oil. However, due to increased domestic output (fracking of shale and other energy resource discoveries) as well as rapidly increasing production efficiencies, since 2008 this has already significantly reduced and expected to continue to fall.[11]

Aviation fuel taxes[edit]

As of 2011, aviation gasoline (most often used to fuel small General Aviation aircraft) is taxed at 19.4¢/gal.[12]

As of 2007, jet fuel (called "kerosene for aviation" by the IRS) is taxed at 21.9¢/gal unless it is used for commercial aviation (airlines such as American Airlines and United Airlines and small chartered commercial jets). Because such commercial operations are subject to the federal transportation tax, they are subject to a reduced fuel tax of 4.4¢/gal.[13]

These taxes mainly fund airport and Air Traffic Control operations by the Federal Aviation Administration (FAA), of which commercial aviation is the biggest user.

See also[edit]

US tax system:


  1. ^ http://www.eia.gov/petroleum/marketing/monthly/pdf/enote.pdf U.S. Energy Information Administration/Petroleum Marketing Monthly
  2. ^ http://www.fhwa.dot.gov/infrastructure/gastax.cfm US Department of Transportation, Federal Highway Administration: When did the Federal Government begin collecting the gas tax?
  3. ^ Motor Fuel Taxes, American Petroleum Institute, 25 October 2015
  4. ^ Corning, Howard M. Dictionary of Oregon History. Binfords & Mort Publishing, 1956.
  5. ^ [1], State Motor Fuel Taxes: Notes Summary.
  6. ^ Online NewsHour: Conversation | Peters Discusses Infrastructure | August 15, 2007 | PBS
  7. ^ http://financecommission.dot.gov/background%20documents.html National Surface Transportation Infrastructure Financing Commission
  8. ^ US inflation Calculator
  9. ^ [2]
  10. ^ http://www.wsj.com/articles/states-siphon-gas-tax-for-other-uses-1405558382
  11. ^ http://www.eia.gov/todayinenergy/detail.cfm?id=15531
  12. ^ [3]
  13. ^ [4]

External links[edit]