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rate Fuel taxes in the US vary by type, with federal and states differing for gasoline, diesel, aviation fuel, natural gas, and ethanol.

- Research suggests federal gasoline tax is $0.184 per gallon, diesel at $0.244, with state taxes adding variability.

- It seems likely that aviation fuel has specific rates, like $0.194 for aviation gasoline, with state taxes also applying.

- The evidence leans toward natural gas fuels being taxed at $0.183 per GGE for CNG and $0.243 per DGE for LNG, with state variations.

- Ethanol taxes align with gasoline, but credits exist; electric vehicles face fees rather than fuel taxes, with federal credits up to $7,500.

  Federal and State Overview
Fuel taxes fund transportation infrastructure, with federal rates set since 1993, unadjusted for inflation, sparking debate. States add their own taxes, ranging widely, and some impose sales taxes on fuel, adding complexity.

   Gasoline and Diesel Details

-  Gasoline:  Federal tax totals $0.184 per gallon, with state rates from $0.0895 (Alaska) to $0.596 (California) per gallon in 2025.

-  Diesel:  Federal tax is $0.244 per gallon, with state rates like Pennsylvania at $0.741 and Alaska at $0.0895, reflecting higher commercial use.

    Other Fuels

-   Aviation Fuel:  Federal rates include $0.194 for aviation gasoline and $0.219 for non-commercial jet fuel, with state taxes varying.

-  Natural Gas Fuels:  Taxed at $0.183 per GGE for CNG and $0.243 per DGE for LNG, with state taxes based on energy equivalence.

-  Ethanol:   Blended with gasoline, subject to similar taxes, but with production credits; electric vehicles face state fees, not fuel taxes, with federal credits up to $7,500.

  Survey Note: Comprehensive Analysis of Fuel Tax Regulations in the US

Fuel taxes are a cornerstone of the United States' revenue system, primarily allocated to fund transportation infrastructure, including highways, roads, and public transit. These taxes are levied on various fuel types, such as gasoline, diesel, aviation fuel, natural gas, ethanol, and, indirectly, through fees for electric vehicles. This analysis, current as of March 2, 2025, explores the federal and state regulations governing these taxes, their rates, and their implications .

  Federal and State Tax Framework

At the federal level, fuel taxes contribute to the Highway Trust Fund, split into a Highway Account for road projects and a Mass Transit Account for public transportation. The federal excise tax on gasoline, last raised in 1993, has not been adjusted for inflation, leading to a 111% increase in inflation by December 2023, which has sparked debates about its adequacy for infrastructure funding. State taxes vary significantly, with some states imposing additional sales taxes or fees, adding complexity to the tax landscape.

  Gasoline: The Most Common Fuel

Gasoline, used predominantly in personal and commercial vehicles, faces a federal excise tax of $0.183 per gallon, plus a Leaking Underground Storage Tank (LUST) fee of $0.001 per gallon, totaling $0.184 per gallon. State excise taxes, as of 2025, range from $0.0895 per gallon in Alaska to $0.596 per gallon in California, with examples including New York at $0.2455 and Texas at $0.20. Some states impose sales taxes, though most exempt gasoline to avoid double taxation, reflecting the variability in state policies.

  Diesel: Higher Rates for Heavy Use

Diesel, common in heavy vehicles, has a federal excise tax of $0.243 per gallon, plus the $0.001 LUST fee, totaling $0.244 per gallon. This higher rate reflects its use in commercial applications, which cause more road wear. State taxes vary, with Pennsylvania at $0.741 per gallon and Alaska at $0.0895, illustrating the range. Like gasoline, some states may add sales taxes or fees, impacting the total cost.

  Aviation Fuel: Specific Rates by Use

Aviation fuel, including aviation gasoline (avgas) and jet fuel, has distinct federal tax rates based on use. Aviation gasoline is taxed at $0.194 per gallon, while jet fuel for non-commercial aviation is $0.219 per gallon, and general use jet fuel at $0.244 per gallon. Commercial aviation faces a reduced rate of $0.044 per gallon for jet fuel, with additional taxes on transportation. State taxes vary, often funding airport-related purposes, with rates not uniformly detailed but known to differ by state.

  Natural Gas Fuels: Taxed by Energy Equivalence

Natural gas, used as compressed natural gas (CNG) or liquefied natural gas (LNG) for transportation, is taxed federally at $0.183 per gasoline gallon equivalent (GGE) for CNG and propane, and $0.243 per diesel gallon equivalent (DGE) for LNG. A GGE is the amount of natural gas with the same energy as one gallon of gasoline, and DGE for diesel. State taxes vary, often aligning with energy content, reflecting efforts to integrate alternative fuels into the tax system.

  Ethanol and Alternative Fuels: Blended and Incentivized

Ethanol, typically blended with gasoline (e.g., E10, E85), is subject to the same taxes as gasoline. However, federal and state incentives exist, such as the expired Volumetric Ethanol Excise Tax Credit (VEETC) at $0.51 per gallon, and current credits for production, aiming to promote renewable fuels. These incentives recognize changing market dynamics, supporting innovation in the biofuel sector.

  Electric Vehicles: Fees Instead of Fuel Taxes

Electric vehicles (EVs) do not consume traditional fuels, thus avoiding fuel taxes. However, to offset lost revenue, 45 states collect at least one tax or fee, with 28 states imposing at least two, and three states at least three. These include registration fees, ranging from $50 to over $1,000 annually, and charging taxes at public stations, creating an "EV Penalty" where EV drivers in 36 states, including the District of Columbia, pay more than gasoline vehicle drivers. Federally, EVs qualify for a clean vehicle tax credit up to $7,500, processed at purchase or via IRS Form 8936, incentivizing adoption.

  How Fuel Taxes Are Utilized

Federally, fuel taxes fund the Highway Trust Fund, with the Highway Account supporting road projects and the Mass Transit Account aiding public transit. States use these revenues for their transportation departments, maintaining state highways and local roads, with some allocating funds for public transportation, bike paths, and mobility projects, ensuring infrastructure sustainability.

    Challenges and Future Trends

The rise of EVs and alternative fuels challenges the traditional fuel tax system, as these vehicles reduce gasoline and diesel consumption, eroding tax bases. This has led to proposals for mileage-based fees or EV charging taxes, aiming for equitable road funding. The lack of inflation adjustment for federal rates, with a 111% inflation increase since 1993, underscores the need for reform to maintain funding levels, amidst ongoing policy debates.

  Conclusion

Understanding fuel tax regulations is vital for stakeholders, given their variability and evolving nature. Federal rates provide a baseline, but state taxes and fees, especially for EVs, add complexity. Staying informed, using resources like the Administration ([EIA](https://www.eia.gov/)), Federal Highway Administration ([FHWA](https://www.fhwa.dot.gov/)), and Internal Revenue Service ([IRS](https://www.irs.gov/)), ensures compliance and effective financial planning as transportation and energy landscapes shift.

  Key Citations

- [Federal Highway Administration Motor Fuel Data](https://www.fhwa.dot.gov/policyinformation/motorfueldata.cfm)

- [Internal Revenue Service Sustainable Aviation Fuel Credit](https://www.irs.gov/credits-deductions/businesses/sustainable-aviation-fuel-credit)

- [ComplyIQ Gasoline State Excise Tax Rates for 2025](https://www.complyiq.io/gas-tax-state-2/)

- [Alternative Fuels Data Center Natural Gas Laws and Incentives](https://afdc.energy.gov/fuels/laws/NG?state=US)

- [Tax Foundation Electric Vehicles EV Taxes State](https://taxfoundation.org/data/all/state/electric-vehicles-ev-taxes-state/)