It’s Earth Day: What’s The Connection Between Gas Taxes And State Carbon Footprints?

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In observation of Earth Day (April 22), we thought it would be timely to explore environmental taxes. Which states have the highest gasoline taxes? Which states have the lowest? Are gasoline tax revenues used for ecological causes? And perhaps most interestingly, what is the correlation (if any) between gasoline taxes and the states with the highest and lowest carbon footprints?

We explore the data to offer some answers below.

States With The Highest Gasoline Taxes


Contrary to general assumptions, gasoline taxes vary widely from state to state, and this explains a great deal of the variance between per-gallon prices in different areas. Here are the ten states with the highest gas taxes (combining both the 18.4 cents federal tax and the individual state tax) in 2010:

  • California: 67.0 cents/gal
  • Hawaii: 63.5 cents/gal
  • New York: 63.3 cents/gal
  • Connecticut: 61.0 cents/gal
  • Illinois:  58.8 cents/gal
  • Washington:  55.9 cents/gal
  • Michigan:  54.2 cents/gal
  • Indiana:  53.2 cents/gal
  • Florida:  52.8 cents/gal
  • Nevada: 51.5 cents/gal

Note that the mean state gasoline tax was 29.3 cents/gal at time of reporting.

States With The Lowest Gasoline Taxes


Meanwhile, these were the ten states with the lowest cumulative gasoline prices:

  • Virginia: 38.0 cents/gal
  • Arizona: 37.4 cents/gal
  • New Mexico: 37.2 cents/gal
  • Mississippi: 37.2 cents/gal
  • Missouri: 35.7 cents/gal
  • Oklahoma:  35.4 cents/gal
  • South Carolina:  35.2 cents/gal
  • New Jersey:  32.9 cents/gal
  • Wyoming:  32.4 cents/gal
  • Alaska:  26.4 cents/gal

Are Gasoline Taxes Used to Reduce Transportation?


The popular notion holds that gasoline taxes are set aside and used expressly for traffic projects: road repairs, public transportation, and reducing congestion on America’s roads. Yet while this may have once been the case (and still happens to a limited extent) gasoline taxes appear to be used for a much wider array of purposes.

According to a Tax Foundation report:

“Unfortunately, the years of political pressure have eroded the original intent of gas taxes. In all too many instances, benefit-principle taxation has taken a backseat to political pandering. For instance, current federal highway legislation authorized over 6,000 earmarks from the highway trust fund. Some of these went to legitimate transportation programs, but others were earmarked for items such as the infamous “bridge to nowhere.” Today, gasoline tax revenue is spent on everything from public education and museums to graffiti removal and parking garages.”

In other words: gasoline taxes are increasingly being spent in areas having little or nothing to do with transportation.

Most Cumulative Emissions


Citizens and environmental scholars often wonder if high gasoline taxes actually discourage driving and make a visible dent in a state’s carbon footprint. Evidence is inconclusive, but we can look to the states with the highest and lowest cumulative emissions for clues.

According to a 2009 Greenpeace study, the following ten states had the most emissions from 1960-2005:

  • Texas: 25,291
  • California: 15,390
  • Pennsylvania: 13,160
  • Ohio: 12,351
  • Illinois: 10,752
  • New York: 10,696
  • Indiana: 8,950
  • Michigan: 8,538
  • Louisiana: 8,369
  • Florida: 7,405

NOTE: Millions of tons

Fewest Cumulative Emissions


The same study identified the following ten states as having the lowest emissions from 1960-2005:

  • Vermont: 256
  • Washington DC: 309
  • South Dakota: 533
  • Rhode Island: 541
  • Idaho: 568
  • New Hampshire: 646
  • Hawaii: 762
  • Delaware: 771
  • Maine: 848
  • Montana: 1,045

NOTE: Millions of tons

While some names appear on opposite lists (such as Hawaii having some of the highest gasoline taxes and some of the lowest cumulative emissions) there does not appear to be a close relationship between gasoline taxes and carbon footprints. Moreover, gasoline tax revenues are not idealistically set aside for transport purposes, but rather, spent broadly across state needs.

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