Special Report

States With the Lowest and Highest Gas Taxes

How much Americans pay at the pump depends on several factors — primarily, the price of crude oil, which is determined in large part by global supply and demand. Other variables affecting the price of a gallon of gasoline include transportation expenses, 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 5% of the total cost of gas to more than 20%, depending on where you live. 

Using data from the American Petroleum Institute, an industry advocacy group, 24/7 Wall St. ranked all 50 states based on total taxes and fees each charges for a gallon of gas. States were ranked from the lowest tax rate to the highest. The total average price of a gallon of gas came from AAA’s Daily Fuel Gauge Report. We also calculated the average annual vehicle miles travelled per licensed driver in 2018 in each state with data from the Federal Highway Administration. Generally, states with higher state taxes and fees have fewer miles traveled per registered vehicle. 

The federal government and state governments use gasoline taxes to fund road construction and repair. Gasoline taxes also help preserve road conditions by making driving, which wears down on roadways, more expensive. 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 taxes charged at a per gallon rate, gas taxes 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. This is due in large part to the steep drop in crude oil prices in 2014. A gallon of gas cost an average of $2.50 in the United States as of late January. As recently as 2012, however, 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

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