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10 States with the Highest Gasoline Tax

By Edited May 9, 2015 3 0
States with the Highest Gas Tax
Credit: mjpyro

Gas taxes and tolls are some of the ways that state transportation departments use to fund new work and maintenance for roads and bridges. However, these projects have not been paying for themselves for many years requiring states to run deficits in their transportation department.

About 30 percent of the cost of road projects within states come from their gas tax fund, but this is further diluted because many use it to fund mass transit projects such as light rail.

To further complicate the issue, tax revenue has been declining over the last decade for several reasons.

First, cars are getting better fuel mileage which means consumer purchase less gallons of gasoline so there are less taxes collected.

Second, Americans are driving less as the price of gasoline per gallon has risen since the gas shocks created after Hurricane Katrina in 2005.

Furthermore, some states use a portion of the gas tax they collect in other areas of their government. Texas for example, uses .05 cents of every dollar collected to help fund its education program.[1]

As the revenue has stagnated or decreased, the price of labor, asphalt, steel and the machinery needed to put it all in place has climbed higher in price. The current system of tax collection is not sustainable in the long term. Some states have not altered their gas tax for 2 decades while the cost of labor and building materials have gone up 10% or more.

Increasingly, states are raising their gasoline tax or looking for other ways to fund their road improvement projects.

In the last several years, Maryland, Massachusetts, Pennsylvania, Vermont, Virginia and Wyoming and the District of Columbia have either increased the gas tax or altered the way it is collected or updated.[2]

Some are adjusting their monthly payouts similar to the way the Social Security Administration sets automatic “cost of living adjustments”, or COLAs.

This allows them to avoid the political fights associated with tax hikes by linking them to the inflation rate. Currently 18 states, plus the District of Columbia link their gas tax to inflation or the price of fuel according to the Institute on Taxation and Economic Policy.

The current national average for the gas tax (including the Federal tax) is 49.4 cents per gallon.

Highest State Gas Taxes

The following chart shows the national average for the various types of gas taxes collected by most states.[2]

National Average


State Excise Tax

20.87 ¢ /gallon

Other State Taxes

10.62 ¢ /gallon

Total State and Federal Taxes

49.89 ¢ / gallon

The total amount is arrived at by adding 18.4 cents a gallon that is sent to Washington D.C. to be used to fund road projects nationally. That portion of the tax has not changed since 1993 so there is always the threat that it too could be adjusted in any political year making any state increases that much harder on the consumer.

With that in mind, you might be curious where your state ranks.

Here are the top 10 states with the highest gasoline tax in the country.[2]

10. Florida

Credit: mjpyro

The Florida Department of Transportation only collects 4 cents per gallon for its state fund.[2] So how is it number 10 on the list?


In some respects, it makes sense that Florida would be on this list because it has no state income tax. Governments need money so local municipalities use the gas tax to fund all of their projects and government functions. When all of the taxes are combined with the 18.4 cent Federal tax, people in Florida pay 54.2 cents per gallon.[2]

9. Washington

Highest State Gas Taxes
Credit: Opensource

The state of Washington's gas tax is 37.5 cents per gallon but when combined with the 18.4 cent Federal tax, Washingtonians are paying 55.90 cents for every gallon they purchase. However, unlike Florida, they do have a state income tax too.

8. North Carolina

Highest State Gas Taxes
Credit: mjpyro

When you think of southern states, you probably think of lower tax environments. However,  North Carolina comes in just above the state of Washington with a state tax 37.6 cents per gallon. When combined with a 0.3 cent gas inspection fee and the Federal 18.4 cent take, the state’s residents are paying a combined 56.15 cents per gallon of gas.[3]

7. Illinois

Highest State Gas Taxes
Credit: mjpyro

The Illinois Department of Transportation levies 19 cents per gallon, but once you add in taxes for an underground storage tank fund, plus the 18.4 cents that goes to the Feds, the total amount comes to 57.5 cents for each gallon purchased.[4]

6. Indiana

Highest State Gas Taxes
Credit: Opensource

Indiana is almost identical to Illinois in the amount they collect and how it is allocated. Indiana’s gas excise tax is 18 cents per gallon. They also add a 1 cent gas inspection fee, so when combined with the federal portion, the total tax residents are paying for a gallon of gas in taxes is 59.21 cents.[5]

5. Michigan

Highest State Gas Taxes
Credit: mjpyro

Michigan's gas excise tax is 19 cents per gallon plus a sales tax on everything and an environmental regulation fee.  When combined with the Federal government’s take, people in the state are paying 59.79 cents for every gallon of gas they purchase.[6]

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4. Connecticut

Highest State Gas Taxes
Credit: Morrow Long via Wikimedia Commons

Michigan's gas excise tax is 19 cents per gallon plus a sales tax on everything and an environmental regulation fee.  When combined with the Federal government’s take, people in the state are paying 59.79 cents for every gallon of gas they purchase.[6]

3. New York

Highest State Gas Taxes
Credit: WebTV3 via Wikimedia Commons

The top 3 states will probably be obvious to you given their high tax history or their geographic location.

The Empire State has a gas excise tax of only 8.1 cents.[1] So how does it make the top 3?

Well, it gets its money from other sources such as a petroleum testing fee and sales taxes on gasoline. When the Federal tax is added in, New Yorkers are paying 68.2 cents per gallon of gas.[8]

2. Hawaii

Highest State Gas Taxes
Credit: Opensource

You could have guessed that Hawaii would be at the top of this list given the fact that they have to import all of their gasoline.

The state government has a 17 cent tax on each gallon but also collects a sales tax and an environmental response tax. When the Federal cut is added in, Hawaiians are paying 69 cents in taxes for every gallon of gas they purchase.[9]

1. California

Highest State Gas Taxes
Credit: Tobias Müller via Wikimedia Commons

You can check out any time you want, but you will pay the highest gas tax on your way out.

You might have guessed that California would have the highest gas taxes in the United States given their strict pollution laws.

California levies a 39.5 cents plus other fees that total 13.9 cents. When the Federal tax of 18.4 is added in, Californians pay a whopping 71.2 cents for each gallon of gas.[10]


Governments have to get their money from somewhere but some of the results may be a bit misleading.

For instance, some states may opt for a higher gasoline tax while lowers taxes in other areas, as is the case with Florida and North Carolina. However, one way or the other, they too get their money so take that into consideration.

When a state has a high combined gas tax, the one advantage to consumers is that they can somewhat control their tax burden by opting for other methods of transportation.

Taxation usually comes down to a simple choice. Would you prefer it come out frequently in the form of sales taxes like these, or would you prefer to pay lower sales taxes on everything and get walloped at the end of the year with income taxes? 

In terms of having the ability to control your tax burden, I opt for the former rather than the latter.

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  1. Gas Tax Facts. College Station, PDF: Texas A&M Trasnportation Institute, 2013.
  2. "Gasoline Tax by State." American Petroleum Institute. 6/05/2014 <Web >
  3. "Total US Fuel by State." NorthCarolinaGasPrices. 28/12/2014 <Web >
  4. "Total US Fuel Taxes by State." Illinois Gas Prices. 28/12/2014 <Web >
  5. "US Tax Map." Indiana Gas Prices. 28/12/2014 <Web >
  6. "Gas Prices." Michigan.gov. 28/12/2014 <Web >
  7. "Connecticut General Excise Taxes - Gasoline, Cigarettes, and More." Tax Rates.org - The Tax Resource. 28/12/2014 <Web >
  8. "What do the state and local governments generate in fuel taxes?." GasPriceWatch. 28/12/2014 <Web >
  9. "Gas Tax – Gasoline Tax by State." GasTax. 28/12/2014 <Web >
  10. "Fuel taxes in the United States." Wikipedia. 28/12/2014 <Web >

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