NCPA - National Center for Policy Analysis

MOST STATES HOLD LINE ON GAS, SALES TAX

July 6, 2007

In general, states across the nation haven't raised gas taxes in the past year, but unfortunately, generalities don't always offer solace, says the Associated Press.

According to a survey by CCH Inc., a tax information publisher:

  • In Washington State, the gas tax jumped from 2 cents to 36 cents a gallon this July compared with last July.
  • Seven states raised their gas tax rates in the past year; Washington's 2-cent hike was the steepest.
  • The national average for the cost of a gallon of regular gas is $2.95, off from the all-time high of $3.23 a gallon in May, but still 3 cents higher than a year ago.
  • Gas taxes range from 7.5 cents a gallon in Georgia to Washington's 36 cents.

The CCH survey focuses on taxes levied by states, but there are plenty of other government agencies charging gas taxes, including cities and counties. There are often environmental fees too. Some states also charge a sales tax on gas.

States also held sales taxes relatively steady, said Daniel Schibley, an analyst with CCH. But just as with gas taxes, cities and counties can have their own sales levies. For example:

  • Alabama levies a 4 percent state sales tax, seemingly far lower than Mississippi's 7 percent rate.
  • But if you make a purchase in Montgomery, Ala., you'll pay up to 10 percent in sales taxes, once a 2.5 percent city tax and 3.5 percent county tax are tacked on.
  • Meanwhile, Jackson, Miss., charges just the base 7 percent state rate.

Source: Andrea Coombes, "Most States Hold Line on Gas, Sales Tax," Forbes, July 5, 2007.

 

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