EnergyFactor By ExxonMobil | Pespectives has a new home

Gasoline taxes and the price at the pump

A lot goes in to how much motorists pay at the pump, with the underlying price of crude oil the biggest determinant of what drivers can expect to pay when filling up.

But taxes can also take a big bite.

A suite of federal, state, and local taxes can add anywhere from 30 to 70 cents per gallon to your bill, depending on where in the United States you happen to refuel.

The differences are strictly regional; since the federal gasoline tax is 18.4 cents per gallon coast-to-coast, variations in total gasoline and excise taxes are the products of decisions made at the state, county, and local levels.

The American Petroleum Institute offers a handy map of the U.S. that breaks down the gasoline tax regimes in the 50 states and the District of Columbia. (Click the map to enlarge.)

Gas_Tax_Map_04-2015

For an interactive version that gives more detail for each state, click here.

A couple things have changed since the last time I highlighted this issue in February 2014.

One is that gasoline taxes have gone down in several locales, most notably high-tax states like California, Connecticut, Hawaii, Illinois, and New York.

Those declines come in part because various taxes and fees that are applied as a percentage of the price of gasoline (rather than on a per-gallon basis) are now being applied to lower-priced fuel. The tax bite is therefore now lower, though it’s worth pointing out those states still have some of the overall highest gasoline taxes in the country.

Another thing to keep in mind is that as gasoline prices have fallen over the last year, taxes have been taking an even bigger share of the amount that drivers spend to fill their vehicles’ gas tanks.

Meanwhile, taxes are up substantially in a number of other states, most notably Iowa (+25 percent), Pennsylvania (+16 percent), and South Dakota (+20 percent).

The highs and lows are extreme.

A motorist filling up in the Keystone State can now expect to pay 70 cents in gasoline taxes for each gallon purchased, the most in the nation. That’s almost two-and-a-half-times as much as in the lowest-tax state, Alaska, where motorists will pay just a little bit under 30 cents per gallon in taxes when they buy gasoline.  And it’s more than twice what motorists pay just across the Delaware River in neighboring New Jersey.

The national average for gasoline taxes comes to 48.85 cents per gallon.

For perspective, consider that in 2014 ExxonMobil earned about 4 cents for every gallon of gasoline and other petroleum products we refined, shipped, and sold in the United States.

The owner of a typical car or truck with a 16-gallon gas tank will pay $41.12 to fill up, based on the current price of $2.57 for a gallon of regular gasoline. Of that, $7.82 will go to taxes, while around 64 cents will go to ExxonMobil’s bottom line (assuming the driver refuels at one of our stations).

For more detailed information on each state’s gasoline taxes, check out this pamphlet from the American Petroleum Institute.

 

 


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