Diesel Road Tax: Frequently Asked Questions

January 27, 2012

A diesel road tax is the taxation that the government puts onto the sale of diesel fuel. This type of fuel is used most commonly in European made car motors and non-road vehicles (such as tractors, agricultural vehicles and other related modes of transportation). Due to diesel CO2 emission ratings, the taxation on diesel fuel in the states is different from that of standard gasoline. This taxation level also varies state by state as well, meaning that there's little regularity in the price of diesel throughout the entire country.

Number 1 -- Why is there a Diesel Road Tax?

The government taxes both diesel and regular types of fuel because of the emissions of those fuels. These chemicals cause environment-damaging gases to be released into the air. As a result, and for reasons of protecting the atmosphere and the environment, the government has initiated a taxation on diesel fuel and other types of gasoline as well.

Number 2 -- How is Diesel Road Tax Paid?

There is no procedure that an individual must go through to pay for the diesel fuel that they use separate from the purchase of the fuel itself. The tax is added on to the cost of the fuel when you purchase it at a gas station. Thus, fluctuations in the tax and the cost of the fuel itself are impossible to tell apart, unless you have knowledge of the current taxation levels and proceedings.

Number 3 -- How Much is Diesel Road Tax?

There is no single road tax for diesel fuel in the United States of America. Rather, there are two different components that make up the total cost of the tax. The first is the Federal government tax on diesel. At the time of writing, this tax was 24.4 cents per gallon diesel fuel sold. The second component of diesel tax is instituted by each of the states (and the District of Columbia). Thus, there is no single diesel tax in the country. The mean average diesel tax at the time of writing was 50.8 cents per gallon.

Number 4 -- Which States Have the Cheapest Diesel Tax?

Because individual states control the cost of the diesel tax for their regions, it's difficult to say with any certainty which states have the lowest taxes. These taxes can change at virtually any time. However, nearly all states are roughly equivalent in the amount that they tax diesel fuel. The mean average is 26.4 cents per gallon.

Number 5 -- Are there Additional Taxes?

Some states and areas charge sales tax on top of the cost of the gas tax itself. This will increase the overall price of gas at the pump to the consumer.

If you have any additional questions about how diesel is taxed, why this tax exists or where to find the cheapest diesel fuel, consult with your local DMV or look at federal and state records online.

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