The states with the highest gas taxes right now

California, Washington, and Illinois currently have the highest state gasoline taxes in the country, each charging between 68 and 70 cents per gallon on top of the federal tax of 18.4 cents. Pennsylvania, Hawaii, and Indiana follow close behind at rates between 58 and 60 cents per gallon. These rates change throughout the year as states adjust their fuel tax formulas, so the exact ranking shifts periodically.

The reason these states rank highest varies. California's tax is high partly because the state blends special fuel formulations to meet air quality standards, which costs refineries more to produce. Washington uses a percentage-based tax that rises when oil prices climb. Pennsylvania's rate reflects decades of infrastructure funding without a major rate cut. Hawaii's remoteness and limited refining capacity push costs up. The point is that no single reason explains why one state taxes gas more than another—it depends on the state's tax structure, when they last raised the rate, and what they fund with the money.

Key Takeaways

  • California, Washington, and Illinois have the highest state gas taxes, ranging from 68 to 70 cents per gallon, on top of the 18.4-cent federal tax.
  • State gas tax rates change throughout the year because many states use formulas tied to inflation, oil prices, or automatic adjustment schedules.
  • Some states use a flat per-gallon rate while others use a percentage of the pump price, which means their tax goes up when crude oil prices rise.
  • The lowest state gas taxes are in Alaska, Mississippi, and South Carolina, where rates fall below 15 cents per gallon.

How state gas taxes are structured

States use two main methods to tax gasoline: a fixed per-gallon rate or a percentage of the wholesale price. A fixed rate means the tax stays the same whether gas costs $2 or $4 per gallon—for example, California charges a flat 68.36 cents per gallon. A percentage-based tax, used by states like Washington, means the tax amount changes as the price of fuel changes. When crude oil prices drop, the tax drops with it; when prices rise, so does the tax.

Some states also layer on additional taxes or fees. California adds a sales tax on top of its per-gallon excise tax. Several states have environmental fees tied to fuel quality standards. A few states charge different rates for diesel than for gasoline. These variations mean that the total tax you pay at the pump in one state can be significantly different from another state's total, even if their base per-gallon rates look similar on paper.

States also adjust their rates on different schedules. Some raise rates annually based on inflation. Others hold rates steady for years and then increase them in one jump. A handful use automatic adjustment formulas that trigger when certain conditions are met. This means the ranking of highest-tax states can shift from month to month or year to year as different states implement their scheduled changes.

Why states tax gasoline differently

The primary reason states tax gasoline is to fund road and bridge maintenance. Most state gas tax revenue goes directly to the Department of Transportation or a similar agency. States with older infrastructure, higher traffic volumes, or more rural roads to maintain often need more revenue, which can push their tax rates higher. Pennsylvania, for instance, has extensive highway networks and aging infrastructure that requires constant repair.

Environmental regulations also drive tax differences. California's fuel must meet stricter emissions standards than fuel sold in most other states, which increases production costs. The state's gas tax partly reflects those higher costs. Similarly, some states impose additional environmental fees on fuel to fund pollution cleanup or renewable energy programs.

Political decisions about tax policy matter too. Some states have raised gas taxes recently to address funding shortfalls, while others have held rates steady or even cut them. A state's willingness to raise taxes, the strength of its economy, and the political climate all influence whether a rate stays low or climbs higher than neighboring states.

The lowest gas tax states

Alaska, Mississippi, and South Carolina have the lowest state gas taxes, each charging less than 15 cents per gallon. Alaska's rate is particularly low at around 14.7 cents per gallon, partly because the state has oil production revenue that reduces reliance on fuel taxes. Mississippi and South Carolina have historically kept rates low and have not raised them significantly in recent years.

Several other states—including Wyoming, Missouri, and New Mexico—also maintain rates below 20 cents per gallon. These lower-tax states often have less dense populations, lower traffic volumes, or different funding sources for road maintenance. Some rely more heavily on general state revenue rather than dedicating fuel tax income to transportation.

How much you actually pay in total gas tax

Your total gas tax at the pump includes both the state tax and the federal tax of 18.4 cents per gallon. If you fill up in California, you pay 68.36 cents in state tax plus 18.4 cents in federal tax, for a combined 86.76 cents per gallon in tax alone. In Alaska, you pay 14.7 cents in state tax plus 18.4 cents federal, for a combined 33.1 cents per gallon.

Some states also add sales tax on top of the per-gallon excise tax, which increases the total further. In California, you pay sales tax on the fuel itself, making the total tax burden higher than the per-gallon rate alone suggests. In other states, the per-gallon tax is the only state-level tax on fuel. This means comparing two states' gas taxes requires looking at the full picture, not just the headline per-gallon rate.

When and why gas tax rates change

States adjust gas tax rates for several reasons. The most common trigger is inflation—many states have laws that automatically raise the tax rate each year to keep pace with rising costs. Other states raise rates when they pass new transportation funding bills, often after years of holding rates steady. A few states lower rates temporarily when crude oil prices spike, to ease the burden on drivers.

The timing of rate changes varies widely. Some states adjust on January 1st each year. Others change rates on July 1st or on the first day of each quarter. A handful adjust rates monthly based on wholesale fuel prices. If you are comparing gas taxes across states or planning a trip, check the current rates for the states you are interested in, because the ranking and the exact amounts change throughout the year.

Frequently Asked Questions

Does the federal gas tax explore in every state?

Yes. The federal excise tax of 18.4 cents per gallon applies nationwide on top of whatever state tax you owe. Every gallon of gasoline sold in the United States is subject to both the federal tax and the state tax where you purchase it.

Why is Hawaii's gas tax so high?

Hawaii has limited refining capacity and must import most of its fuel, which increases costs. The state also has strict environmental standards for fuel quality. These factors push the base price of fuel higher, and Hawaii's percentage-based tax structure means the tax amount rises along with the price.

Can I avoid state gas tax by buying gas in a lower-tax state?

You pay tax where you purchase the fuel, not where you live. If you buy gas in a low-tax state, you pay that state's rate. However, most people cannot easily cross state lines for fuel, so this strategy only works if you live near a border and regularly travel there anyway.

Do electric vehicles pay gas tax?

No, electric vehicles do not use gasoline and therefore do not pay gas tax. Some states are exploring alternative fees on electric vehicles to replace the road-funding revenue they lose as more drivers switch to electric power.

How often do states change their gas tax rates?

It depends on the state. Some states adjust rates automatically each year based on inflation or oil prices. Others change rates only when the legislature passes a new law, which might happen once every several years or not at all. Check your state's Department of Transportation website to see when rates are scheduled to change.