Missouri fuel tax increase in effect Oct. 1
September 24, 2021
A new Missouri law days away from taking effect will raise the state’s fuel tax for the first time in one quarter-century.
Starting Friday, Oct. 1, the state’s 17-cent tax rate on gas and diesel will increase by 2.5 cents to 19.5 cents.
The change is due to Gov. Mike Parson earlier this year signing into law a bill to raise the tax rate by 12.5 cents over five years.
Additional 2.5-cent increases will take effect through 2025. At that time, the tax rate will be increased by 73% to 29.5 cents.
Mo. road money
State officials report the state has from $8 billion to $10 billion in unfunded needs for the transportation system.
The additional fuel tax revenue from SB262 is estimated to raise $455 million annually.
The Missouri Department of Transportation receive 70% of the fuel tax. Counties and municipalities each collect 15%.
The funds are apportioned to municipalities based on population. County funds are distributed based on road miles and land valuation.
MoDOT reports that once the fuel tax is fully implemented in 2025, the city of Kansas City is expected to receive $8.9 million annually. The city of St. Louis will collect an estimated $6.2 million yearly. The city of Springfield will receive $3 million each year.
At the county level, St. Louis County will receive $8.1 million each year. Jefferson County will collect $2.8 million annually. St. Charles County will receive $2.7 million per year.
The full list of projections for cities and counties is available.
Rebates available for some
Included in the new law is an option for most Missouri residents to apply for an exemption and refund. The option will be available to residents fueling vehicles with a gross vehicle weight not exceeding 26,000 pounds.
MoDOT officials estimate that 25% of residents eligible for rebates will utilize the option.
Revenue estimates for state, county and local road and bridge work do not include expected rebates.
Alternative fuel vehicles
Owners of alternative fuel vehicles will also contribute more. The fees for decals is being increased by 20% annually for five years.
Fees for electric and hybrid vehicles weighing in excess of 36,000 pounds will see a 10% annual increase over the same time period. LL
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