July 1 not only marks the start of the second half of the calendar year, but it’s also a new fiscal operating year for many state governments.
And that means some new taxes take effect today.
The biggie for many folks is the gasoline tax since the price of fuel tends to go up anyway anytime a holiday, like the long-for-many July 4th weekend that kicked off today.
Six states this new fiscal year have hiked their gasoline taxes. They are Indiana, Montana, New Jersey, South Carolina, Tennessee and West Virginia. Utah also hiked fuel taxes, but on alternative methods to power vehicles
Indiana: The Hoosier State’s excise tax on fuel increases 10 cents, from 18 cents to 28 cents per gallon, thanks to the state’s latest highway improvement bill. The added gas tax money will be used for roads. In addition, Indiana has a gasoline use tax that’s based on the statewide average retail price per gallon of gasoline (excluding taxes). The July 2017 use tax rate is 12.8 cents per gallon, bringing the total gas tax in Indiana to 40.8 cents per gallon as of today.
Montana: The Treasure State’s gas tax goes up by 4.5 cents per gallon today, pushing the levy from 27 cents to 31.5 cents. It’s Montana’s first gas tax increase in more than two decades. Today’s hike is just the first of a five-year phase-in that will eventually increase Montana’s gas tax to 33 cents by fiscal year 2023.
New Jersey: As part of a $2 billion transportation funding bill passed last year, both gas and diesel taxes were increased in the Garden State. Most of the increases already took effect, but a second part of the diesel hike kicks in today, increasing that fuel’s tax rate to 12.5 percent of the per gallon diesel fuel price. Diesel fuel currently costs approximately $2.79 per gallon, including taxes.
South Carolina: Palmetto State drivers are paying higher gas taxes for the first time in 30 years thanks to increases included in an infrastructure bill. Lawmakers made up for the gas tax lag by hiking the tax 12 cents over the next five years, eventually topping out at 28.75 cents per gallon in 2022. The first increase South Carolinians will see at pumps is the 2 cents per gallon that took effect today.
Tennessee: The Volunteer State’s gasoline tax hike also is part of a road funding bill that phases in a total 6 cents per gallon increase over two years, making the gas tax 27.4 cents per gallon by 2019. The first bump taking effect today is the biggest — a 4-cent increase. The other 2 cents will be split evenly, taking effect in 2018 and 2019.
West Virginia: The Mountain State’s gas tax is comprised of two parts, a flat 20.5 cents per gallon portion and a variable tax that’s equal to 5 percent of the average wholesale price of fuel. West Virginia increased the variable component, again as part of a larger road funding measure. The average wholesale price used to calculate the variable tax was bumped up from $2.34 to $3.04, thereby producing a gas tax of at least 15.2 cents per gallon. When added to the 20.5 cents per gallon flat rate, West Virginia’s gas tax today has gone from 32.2 cents to 35.7 cents.
Utah: Right now folks driving alternative fuel vehicles are feeling pretty smug, unless they’re Beehive State residents. The Utah State Tax Commission reminds its residents that the state has increased tax rates for some alternative fuels starting July 1. The tax rate will increase to 14.5 cents per gasoline gallon equivalent for compressed natural gas, liquefied natural gas and hydrogen used in motor vehicles.
However you power your vehicle, make sure you have enough to money to fill it up so you can get to your Independence Day celebrations without problem.
You also might find these items of interest:
- Gas taxes pump up the fuel’s 2017 price in 7 states
- Driving down your tax bill with auto-related deductions
- Trump taking truckers’ call for increased gas tax to heart