Fuel rate changes in six states in effect for 2020

December 30, 2019

Keith Goble

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States around the nation are ringing in the New Year with changes to fuel tax rates.

During the past year about two dozen states have instituted changes.

The most significant increase was implemented in Ohio. As part of a two-year transportation budget deal, the state’s 28-cent tax rate on gas and diesel was raised significantly.

Since July, the state diesel rate is up 19 cents to 47 cents. The gas tax is 10.5 cents higher at 38.5 cents.

Additionally, adjustments range from increases of 6 cents per gallon in Alabama and Arkansas to fractional changes in other states.

Changes for the new year

The most notable change for the beginning of 2020 is slated for Oregon, where the state’s excise tax rate of 34 cents per gallon on gas is on the way up.

A 2017 state law authorized four rate increases through 2024. The initial 4-cent increase to 32 cents took effect in 2018. The second of four rate bumps takes effect on Jan. 1. At that time, the rate will rise two pennies to 36 cents.

For professional drivers, a proportionate increase is applied for diesel.

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Additional rate increases of 2 cents will be implemented in 2022 and 2024, when the fuel tax reaches 40 cents.

Also out west, the state of Utah will implement a modest increase of one penny. The current fuel tax rate of 30 cents will rise to 31.1 cents.

The change marks the third increase since the rate was 24.5 cents at the end of 2015.

The state of Nebraska is also implementing another round of fuel tax rate changes. For the first time in five years, the tax rate will dip.

Regular increases were implemented as part of a four-step rate hike that raised the fuel rate nearly 4 cents from 2016 to 2019. With the annual increases concluded, the rate will inch down nearly one-half cent from 29.7 cents to 29.3 cents.

The state tax is made up of three components: the 2.8-cent variable tax, the 16.3-cent fixed tax and the 10.2-cent wholesale tax. The variable and wholesale rates are adjusted twice annually.

A separate petroleum release remedial action fee is not included in the state tax rates and remains unchanged at 0.9 cents per gallon on gas and at 0.3 cents on diesel.

Changes to the North Carolina fuel tax rate continue. A 2015 state law implemented a new fuel tax formula adjusted annually. The formula is based on a statutory formula that takes into consideration state population and energy cost inflation.

Since the first adjustment three years ago the tax rate has increased from 34.3 cents to 36.1 cents. The rate is down 0.1 cent from 36.2 cents in January 2019.

Automatic adjustments to the fuel tax will result in modest increases in neighboring Georgia and in Florida.

The Georgia tax rate is up from 27.5 cents for gas, to 27.9 cents, and 30.8 cents for diesel, to 31.3 cents.

Florida’s total state and county rates on diesel will increase from 32.9 cents per gallon to 33.2 cents. The total tax on gas will be 32.3 cents – up from 32.2 cents. The local option rate, which is not included and varies by county, is available here.

States with automatic adjustments are due to tax rates calculated by percentage of fuel price in addition to a flat excise tax, fuel tax calculated by percentage of fuel price, indexed to Consumer Price Index, and/or other means.

Some states with automatic adjustments are implemented annually while others change more frequently.

More fuel tax increase coverage.

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Keith Goble

Keith Goble has been covering trucking-related laws since 2000. His daily web reports, radio news and “OOIDA’s State Watch” in Land Line Magazine are the industry’s premier sources for information regarding state legislative affairs.