I often get people emailing me asking why gasoline prices vary so much from one state to another, especially noticeable for those that live near state lines. Each state has the authority to set its own fuel excise taxes. In addition, the federal government receives 18.4 cents per gallon. The national average combined state and federal tax per gallon is 45.6 cents. New York has the highest taxes on gasoline while Alaska has the lowest. Click HERE to see how your state ranks.
Should fuel taxes be even higher? Wouldn’t that promote more fuel efficient vehicles and energy conservation? BusinessWeek published an article in 2005 about the benefits of a gas tax hike. Even some oil executives suggest a higher fuel tax. What do you think?