People like to complain about gasoline prices. After all, it comes straight out of your pockets when you drive to work. You immediately feel the economic consequences. It also gives you a chance to point the finger at the oil companies for your woes. However, a small part of the culprit lies with your federal and state governments.
The federal government charges the final gasoline consumer an excise tax of $0.184 per gallon, according to the American Petroleum Institute. This represents 6.6% of the national average price per gallon of $2.785, according to AAA’s website. The state excise tax national average calculates to $0.3046 per gallon, representing 10.9% of the national average price per gallon. The total national average tax comes to $0.4885, or 17.5% of the national average price per gallon. In other words, the American consumer pays 17.5 cents of every dollar to a government entity on average.
The gas price data below was compiled from the AAA website. The tax information was computed using data from the American Petroleum Institute. All of the states listed below possess excise taxes that are above the national average, with the exception of Alaska. Here are the states with the most expensive gas prices.
1. California
> Price per gallon: $3.554
> State excise tax as a pct. of price per gallon: 13.4%
> Federal excise tax as a pct. of price per gallon: 5.2%
> Total excise tax as a pct. of price per gallon: 18.6%
> Excise taxes above national average? Yes
California came in on top as having the highest price per gallon for the final consumer. Also, California tied with Hawaii on this list as having the highest total excise price as a percentage of the price of gasoline. California also had the highest state excise tax as a percentage of the price of gasoline on this list. The state gets relatively little outside help in oil and gasoline production.
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2. Alaska
> Price per gallon: $3.3770
> State excise tax as a pct. of price per gallon: 3.3%
> Federal excise tax as a pct. of price per gallon: 5.4%
> Total excise tax as a pct. of price per gallon: 8.8%
> Excise taxes above national average? No
Alaska’s total excise taxes came to $0.2970 per gallon, which fell below the national average. This represents the only state among the top five to do so. Alaska possesses no “operating” oil refineries. Alaska exports crude oil and imports all of its gasoline back into the state.
3. Hawaii
> Price per gallon: $3.3290
> State excise tax as a pct. of price per gallon: 13.1%
> Federal excise tax as a pct. of price per gallon: 5.5%
> Total excise tax as a pct. of price per gallon: 18.6%
> Excise taxes above national average? Yes
Like California, Hawaii taxes represent a relatively huge portion of the total price for gasoline. The state takes 13.1% out of the consumers’ gasoline dollars, based on current gas prices. The biggest and most compelling reason that Hawaiian customers pay so much for gas: it brings all the gasoline by ships, which costs more than by pipelines.
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4. Nevada
> Price per gallon: $3.2410
> State excise tax as a pct. of price per gallon: 10.2%
> Federal excise tax as a pct. of price per gallon: 5.7%
> Total excise tax as a pct. of price per gallon: 15.9%
> Excise taxes above national average? Yes
Nevada’s citizens also pay a huge amount in gas excise taxes. The state currently exacts a 10.2% toll for each gallon of gas purchased in the state. Nevada imports most of its gasoline from southern California, and the added cost gets passed to the final gasoline consumer.
5. Washington
> Price per gallon: $3.0730
> State excise tax as a pct. of price per gallon: 12.2%
> Federal excise tax as a pct. of price per gallon: 6.0%
> Total excise tax as a pct. of price per gallon: 18.2%
> Excise taxes above national average? Yes
Based on current gas prices, the state of Washington collects 12.2% of the price for each gallon purchased. The state ranks number two on this list for the amount of excise taxes relative to each gallon of gas purchased. Refinery delays on the west coast also help explain the high prices.
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