Skip to comments.Local, State and Federal Gas Taxes Consume 45.9 Cents Per Gallon on Average (make that 49.9)
Posted on 04/21/2006 5:24:53 PM PDT by xcamel
September 13, 2005
In the wake of Hurricane Katrina and the devastation that has followed, consumers are feeling the economic consequences of the disaster. Record gasoline prices are constantly in the headlines, which leaves many asking why prices are so high. While supply and demand are the primary determinants of gasoline prices, a significant portion of the price consumers pay at the pump can be attributed to gasoline taxes. In fact, the federal gas tax alone equals 18.4 cents for every gallon purchased (See Figure 1).
Figure 1. The Rising Federal Gasoline Excise Tax
Source: Congressional Research Service, Tax Foundation.
In 1932, the federal government imposed the first federal gas tax. It began as a temporary levy with a rate of just 1 cent per gallon. Over the years, the tax burden has increased significantly. The Revenue Act of 1941 made the federal gas tax permanent and increased the rate to 1.5 cents per gallon to help fund the war effort. A decade later in 1951, the tax was increased to 2 cents per gallon to assist in the funding of the Korean War.
After President Eisenhower’s idea of an interstate highway system had been instituted, the federal gas tax was raised to 4 cents per gallon in 1959. As recent as 1981, the federal gas tax remained at 4 cents per gallon. Significant tax increases in 1982, 1990 and 1993 increased the federal gas tax by 14.4 cents per gallon, or 360 percent from 1981 levels.
In 1919, Oregon became the first state in the nation to place a tax on gasoline and every state has subsequently adopted this form of taxation. This year, according to the Energy Information Administration the average state gas tax is 20.8 cents per gallon. In addition to statewide taxes, often consumers pay local excise taxes on gasoline purchases (see Figure 2).
Figure 2. Combined Local, State and Federal Gasoline Taxes, August 2005 (Click for larger image.)
Source: American Petroleum Institute, Tax Foundation.
Today, the combined burden of federal, state and local gas taxes costs American drivers an average of 45.9 cents on every gallon purchased. As Figure 2 illustrates, in some states the combined taxes exceed 60 cents for every gallon purchased. According to data on gasoline use from the U.S. Department of Transportation, that amounts to an annual gas tax burden of roughly $271 for every man, woman and child in the United States. In these times of concern over high gas prices, American consumers should remember that gasoline taxes have a significant impact on the amount they spend at the pump.
(For more information, contact Jonathan Williams at (202) 464-5119.)
Not to mention the cost of the EPA requirements in each state - the very expensive blends required instead of one. There was talk to stop this practice and just use one - looking at it logically; you fill your car up with your state's EPA blend then drive to another state or states, commingling blends along the way - does this make sense to anyone? I think we need to follow the money here
Thanks to the Democrats we will continue to pay and pay and pay. All to protect the future of the country they are trying to destroy.
Same royality percentages apply for natural gas production on federal lands.
And to think, we had a revolution over a pittance tax on tea? How far once free men have fallen into present vassal subjugation.
This news comes out in dribbles. The average American does not understand how enviornmentalist have control over public policy.
Now that MTBE's are phased out gasoline will sky rocket because the substitute enthanol can only be shipped by tankers trucks. Pipe lines cannot be used because ethanol
sucks up water. Therefore high prices.
That takes serious stones or they think we're stupid. $3.00/gal gas really sucks, but I'm not blaming 'big oil' for it.
That tax rate chart looks shockingly simiiar to the increase in Social Security payroll taxes over time.
Wouldn't it be interesting if 50% of the population of this country would stop driving for 1 day, wouldn't use the power mower, tractor, boat, etc. I would wager that a $400 million retirement package wouldn't happen after that, and the fed would get the idea that the people mean business...ahhh, so much for pipe dreams.
The chairman of exxon isn't the problem, your congresscritters are.
I live in Wisconsin and drive to Illinois every day. I am cross contaminating. This is so stupid. One national standard for gas should be used. Once again the government screws us.
I'm looking at those weak-kneed congress-critters (who are in the oil lobby's pocket), the speculators, and the hedge fund investors. The former- chairman of Exxon is just excessive. I didn't own Exxon stock, so I didn't pay for his overindulgent retirement package.
If theres blaming to do, that rest upon the shoulders of the market manipulating Soros crowd and their DUmocrat co-horts.
Yea, temporary until the next increase. Once imposed, the beast must be fed.
The gas taxes are about as close to a fair, use tax as there is in this country. Money for roads has to come from somewhere, and taking that money from gas sales means the people who use the roads pay for them.
Cutting the gas tax will just shift that cost away from actual drivers to your and my income tax returns instead. Just another progressive subsidy. No thanks.
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