skip navigation
Build America Transportation Investment Center (BATIC) Institute: An AASHTO Center for Excellence
Build America Transportation Investment Center (BATIC) Institute: An AASHTO Center for Excellence

Funding

State Funding

State Motor Fuel Taxes and Fees

Among state surface transportation revenue, motor fuel taxes provide a significant contribution, although considerably less than motor fuel taxes' share of Federal revenue. Each state sets its own motor fuel tax rates. As of December 2017, tax rates ranged from approximately 12 to 59 cents per gallon for gasoline and 12 to 75 cents per gallon for diesel fuel. For the purpose of quoting state motor fuels tax rates, other taxes are often included with the excise tax, including sales taxes, environmental fees, fees for underground storage tank and other funds, and local taxes and fees. State sales taxes on motor fuels may be included in a state's motor fuel excise tax and can represent a notable portion of state motor fuel tax revenue. Several states have either all or a portion of their motor fuel tax indexed to a local consumer price index or the wholesale price of fuel.

With respect to interstate motor carriers, taxation of fuel is regulated by the International Fuel Tax Agreement, except in Alaska and Hawaii. IFTA also applies to the 10 Canadian provinces but not the three territories. The agreement simplifies the reporting of fuel used by motor carriers that operate in more than one jurisdiction. The International Fuel Tax Association (IFTA), a non-profit corporation manages and administers the International Fuel Tax Agreement.

The disposition of state-imposed fuel taxes varies by state. A state may direct motor fuel tax revenue to numerous sources, including its department of transportation, special road or bridge funds, county governments, or even state general funds. FHWA's Highway Statistics Table MF-3 summarizes the disposition of state motor fuel taxes.

Resources

American Petroleum Institute Motor Fuel Tax Data (updated quarterly)
The American Petroleum Institute provides summaries of state motor fuel taxes in report, table, and map formats.

IFTA Fuel Tax Rates (updated quarterly)
IFTA maintains a table of fuel tax rates for interstate motor carriers under the International Fuel Tax Agreement.

Highway Statistics (published annually)
These publications are prepared by the FHWA Office of Highway Policy Information presenting and analyzing statistics of general interest on motor fuel, motor vehicles, driver licensing, highway-user taxation, state highway finance, highway mileage, and Federal aid for highways. They also include highway finance data for municipalities, counties, townships, and other units of local government.