Jay L. Zagorsky:
“…Every time you go to the pump, each gallon of fuel you purchase puts money into a variety of pockets.
About half goes to the drillers that extract oil from the earth. Just under a quarter pays the refineries to turn crude into gasoline. And around 6 percent goes to distributors.
The rest, or typically about 20 percent of every gallon of gas, goes to various governments to maintain and enhance the U.S. transportation’s infrastructure.
Currently, the federal government charges 18.4 cents per gallon of gasoline, which provides 85 percent to 90 percent of the Highway Trust Fund that finances most federal spending on highways and mass transit.
State and local government charge their own taxes that vary widely.
Combined with the national levy, fuel taxes range from over 70 cents per gallon in high-tax states like California and Pennsylvania to just over 30 cents in states like Alaska and Arizona. The difference is a key reason the price of gasoline changes so dramatically when you cross state lines.
While people often complain when their fuel prices go up, the real burden of gasoline taxes has been falling for decades. The federal government’s 18.4 cent tax, for example, was set way back in 1993. The tax would have to be 73 percent higher, or 32 cents, to have the same purchasing power.
On top of that, today’s vehicles get better mileage, which means fewer gallons of gas and less money collected in taxes.
And electric vehicles, of course, don’t need gasoline, so their drivers don’t pay a dime in fuel taxes…”