April 8, 2026
Every time a driver pulls up to a gas station, a significant portion of the price they pay is determined not by global oil markets, but by their state legislature. While the federal government adds a flat 18.4 cents to every gallon of gasoline, state taxes vary wildly from a low of just 9.0 cents in Alaska to a staggering 70.9 cents in California as of 2026. This patchwork of taxes explains why a gallon of gas can cost over $5.89 in one state while hovering around $3.27 in another.
This article provides a comprehensive breakdown of gas taxes in all 50 states and explains exactly how these taxes affect the final price you pay at the pump.
📊 The Full Ranking: State Gas Taxes From Highest to Lowest
The following table ranks every state’s gasoline tax and fee as of January 1, 2026. These figures represent state-imposed taxes only and do not include the 18.4 cent federal excise tax that every driver pays.
| Rank | State | Gas Tax (cents/gallon) | Rank | State | Gas Tax (cents/gallon) |
| :--- | :--- | :--- | :--- | :--- | :--- |
| 1 | California | 70.9￠ | 26 | Nebraska | 33.0￠ |
| 2 | Illinois | 66.4￠ | 27 | Wisconsin | 33.0￠ |
| 3 | Pennsylvania | 57.7￠ | 28 | Idaho | 33.0￠ |
| 4 | Washington | 49.4￠ | 29 | Minnesota | 32.0￠ |
| 5 | New Jersey | 49.1￠ | 30 | Maine | 31.0￠ |
| 6 | Nevada | 47.8￠ | 31 | Vermont | 31.0￠ |
| 7 | Indiana | 47.4￠ | 32 | Alabama | 31.0￠ |
| 8 | Oregon | 47.1￠ | 33 | Iowa | 30.0￠ |
| 9 | Maryland | 47.0￠ | 34 | South Dakota | 30.0￠ |
| 10 | Hawaii | 45.4￠ | 35 | Missouri | 30.0￠ |
| 11 | Michigan | 45.3￠ | 36 | Colorado | 29.0￠ |
| 12 | Florida | 44.9￠ | 37 | South Carolina | 29.0￠ |
| 13 | Ohio | 44.7￠ | 38 | Massachusetts | 27.0￠ |
| 14 | Rhode Island | 41.4￠ | 39 | Tennessee | 27.0￠ |
| 15 | North Carolina | 41.0￠ | 40 | Kansas | 25.0￠ |
| 16 | Utah | 40.6￠ | 41 | Arkansas | 25.0￠ |
| 17 | Georgia | 40.3￠ | 42 | Connecticut | 25.0￠ |
| 18 | Iowa | 40.2￠ | 43 | New York | 25.0￠ |
| 19 | Connecticut | 40.1￠ | 44 | Wyoming | 24.0￠ |
| 20 | Texas | 40.0￠ | 45 | New Hampshire | 24.0￠ |
| 21 | Delaware | 40.0￠ | 46 | North Dakota | 23.0￠ |
| 22 | Massachusetts | 39.0￠ | 47 | Delaware | 23.0￠ |
| 23 | New York | 34.7￠ | 48 | Mississippi | 21.0￠ |
| 24 | West Virginia | 32.2￠ | 49 | Louisiana | 21.0￠ |
| 25 | Montana | 32.8￠ | 50 | Alaska | 9.0￠ |
Source: U.S. Energy Information Administration
The Dynamic Nature of State Gas Taxes
State gas taxes are far from static. Between January 2025 and January 2026, 26 states changed their gasoline taxes 19 raised them and 7 lowered them. These changes are driven by several mechanisms.
Indexed and Variable Taxes
Some states have moved away from fixed per-gallon rates and instead tie their taxes to external factors. Kentucky's gas tax, for example, is indexed to the average wholesale price of gasoline. When wholesale prices drop, the tax rate per gallon falls as well. This has led to a 12% decline in Kentucky's gas tax rate (from 27.8 cents to 26.4 cents) over two years, directly reducing Road Fund revenue by nearly 10%.
Connecticut employs a unique two-tax system: a 25 cent retail tax plus a petroleum products gross receipts tax of 8.81% on wholesale transactions. As wholesale prices rise, so does this tax—during the 2026 Iran war, this wholesale tax jumped from 17.6 cents to 24.9 cents per gallon in just 19 days.
Legislative Actions
Other states change taxes through direct legislative action. Michigan increased its gas tax by 5.2 cents per gallon between 2025 and 2026, while Washington raised its tax by 6.2 cents—one of the largest year-over-year increases.
How State Gas Taxes Affect Pump Prices
Understanding the relationship between state gas taxes and retail prices requires looking beyond simple addition. While taxes are a direct component of the final price, several factors mediate their impact.
The Direct Impact: Tax as a Price Component
The most straightforward effect is additive: when a state has a high gas tax, all else being equal, its pump prices will be higher. The numbers bear this out clearly:
- **California** (70.9¢ tax) pays an average of **$5.89 per gallon**
- **Oklahoma** (20¢ tax) pays an average of **$3.27 per gallon**
- **Texas** (20¢ tax) pays approximately **$3.82 per gallon**
However, the relationship is not perfectly linear. Washington has a 49.4¢ tax but pays $5.37 per gallon, while Pennsylvania has a higher 57.7¢ tax but pays just $4.08 per gallon. This demonstrates that taxes are only one piece of a complex pricing puzzle.
Other Factors That Influence Pump Prices
The U.S. Energy Information Administration identifies several additional factors that explain why gas prices vary between states:
Distance from Supply: Retail gasoline prices tend to be higher the further gasoline must be transported to the point of sale. This explains why **Hawaii**, despite a moderate 45.4¢ tax, pays $5.50 per gallon it must import all its fuel.
Environmental Programs: California requires a special "reformulated" gasoline blend that reduces air pollution but requires more processing steps and expensive blending components. This alone adds significant cost beyond the state's already-high taxes.
Supply Disruptions: Any event that slows or stops gasoline production can result in increased bidding for available supplies. The 2026 war with Iran has caused global oil prices to surge, with the national average jumping from $3.00 to $4.08 per gallon in just one month.
Retail Competition and Operating Costs: Prices are often highest in locations with fewer gas stations. Stations also retain about 10% of the retail price to cover operating costs such as transportation and labor.
The Complexity of Tax Holidays
When states suspend gas taxes, the savings don't always reach consumers as expected. Florida Governor Ron DeSantis learned this during previous tax holidays, noting: "I don't think the consumer really felt relief" because retailers may absorb the difference rather than passing it along.
Retail gas stations have charged consumers an average of 38 cents per gallon above wholesale prices over the past five years, with their profits after expenses often less than half that amount. When wholesale prices swing dramatically sometimes by the equivalent of around 40 cents per gallon in a single day the effect of a tax suspension can be lost in the noise of market volatility.
Where the Money Goes: Funding America's Roads
Gas taxes serve a crucial purpose: funding transportation infrastructure. The vast majority of revenue is constitutionally or statutorily dedicated to road and bridge projects.
Pennsylvania: Direct Municipal Funding
In Pennsylvania, gas tax revenues flow directly to municipalities through a "liquid fuels" allocation system. The Pennsylvania Department of Transportation recently issued more than $460 million to help local governments fund road and bridge projects, snow removal, and repaving. Since 2023, nearly $1.87 billion in gas tax money has been funneled to road and bridge projects, improving 19,525 miles of roadway and 1,757 bridges.
The allocation formula is based on population and miles of locally owned roads. To be eligible, a roadway must be formally adopted as a public street and meet specific dimension requirements.
Kentucky: Supporting Local Governments
Kentucky allocates 7.7% of its state gas tax revenues to the Municipal Road Aid program for city roads, funded at $54.3 million for the 2026-27 fiscal year. However, declining gas tax revenue due to lower wholesale prices and flat consumption has forced cuts—this represents a 22% decline from the previous biennium.
The Debate Over Gas Tax Holidays
As gas prices have surged past $4 per gallon nationally in 2026, policymakers have clashed over whether suspending gas taxes provides meaningful relief.
Georgia Takes Action
Georgia became the first state to act in the current crisis. Governor Brian Kemp signed a 60-day suspension of the state's gas tax on March 20, 2026, with the governor stating: "Because we budget conservatively, we can take steps like these that actually deliver on affordability issues for families in our state". Georgia is dipping into its budget surplus to replace the lost revenue.
Utah's Partial Approach
Utah took a different approach, trimming just 6 cents off its 38-cent-per-gallon fuel tax for six months beginning July 1, 2026.
States That Have Held Back
Other states remain skeptical. Maryland Democrats rejected Republican calls for a 30-day gas tax suspension, with Governor Wes Moore's spokesperson noting it would "blow a $100 million hole in our transportation budget while we're working to close Maryland's budget shortfall".
South Carolina Governor Henry McMaster dismissed tax suspensions as a "sort of knee-jerk reaction," noting that the state's gas tax provides about $800 million yearly for infrastructure projects. "We'd like them all to be lower and lower," McMaster said, "but that's one we should not take any money out of".
California's Political Standoff
In California, where gas prices have reached $5.89 per gallon, Republican State Senator Tony Strickland proposed SB 1035 to suspend the state's climate programs and gas tax, estimating it would provide immediate savings of roughly $1.08 per gallon. However, the bill was shot down in committee. Democratic Senator Catherine Blakespear argued that the fees associated with climate programs about 38 cents per gallon help "the same people who are struggling with those high gas prices" through funding for disadvantaged communities.
The Future of Gas Taxes
The traditional gas tax model faces an existential threat. As vehicles become more fuel-efficient and electric vehicle adoption grows, drivers are buying fewer gallons of gas, reducing revenue even as road maintenance costs remain constant.
Pennsylvania officials have explicitly noted that "the traditional revenue streams that support local infrastructure are not keeping pace" with the shift toward EVs and alternative fuels. This challenge will likely define transportation funding debates for the next decade, forcing states to consider alternatives like road usage charges, increased vehicle registration fees for EVs, or broader tax reforms.
Understanding state gas taxes is essential for anyone wondering why prices vary so dramatically across state lines. While taxes are a significant factor accounting for nearly 20% of the price at the pump in many states they interact with global markets, local regulations, and retail competition to produce the final number on the sign. As the 2026 Iran war continues to roil global energy markets and state legislatures debate competing priorities, the gas tax remains one of the most visible and politically charged elements of America's transportation funding system.
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