Energy

This State Has the Highest Gas Tax in America

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A gallon of gasoline cost an average of $2.40 in the United States in late January. Gas prices recovered from their sharp dip during the early months of the COVID-19 pandemic, when prices fell as low as $1.74 per gallon, the result of crude oil prices briefly falling below $0 per barrel.

On a more local basis, how much Americans pay at the pump depends on several factors. Primarily, it is the price of crude oil, which is determined in large part by global supply and demand. Other variables affecting the price of gasoline include transportation and refining costs, and, of course, taxes.

The federal government levies a tax of 18.4 cents on every gallon of gas sold in the United States. On top of that, each state tacks on its own excise tax, which further drives up the cost of fuel. State-imposed taxes and fees can account for anywhere from roughly 5% of the total cost of gas to more than 20%, depending on where you live.

To determine the state with the highest gas tax, 24/7 Wall St. reviewed data on average state gas taxes in January 2021 from the American Petroleum Institute. Data on state gas tax totals does not include the federal gas tax. Supplemental data on average prices for regular gas by state came from AAA. Prices are current as of Jan. 26, 2021. Data on annual vehicle miles traveled and the number of licensed drivers used to calculate annual vehicle miles traveled per capita by state in 2019 came from the Federal Highway Administration.

The federal and state governments use gasoline taxes to fund road construction and repair. Still, higher than average gas taxes do not always translate to well-maintained infrastructure. Here is a list of the states where the largest share of roads and bridges are in a state of disrepair.

With gas taxes charged at a per-gallon rate, they can quickly add up, particularly for Americans driving larger vehicles. Still, from a historic perspective, the price of gasoline today is relatively inexpensive in the United States. As recently as 2012, the average price was over $4 per gallon, adjusted for inflation. Here is a look at the cost of a gallon of gas the year you were born.

Click here to see the states with the lowest and highest gas taxes.

California, America’s largest state by far based on population, has an average state gas tax of $0.61 per gallon. The average gas price as of Jan. 26, 2021, was $3.38 per gallon, the highest in the country. The means that as a percentage of gas prices, state taxes are 18.6%, the fourth highest in the United States. The annual miles traveled per driver total 12,915, the 16th fewest among all states.


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