Necessary Roughness

The Houston Chronicle reports (link dead) that the Texas House has passed an amendment that would cause the state not to collect its 20 cents per gallon for 90 days. The measure must also go through the Texas Senate and get Gov. Rick Perry’s signature.

Doomed or not in the Senate, this measure brings much needed visibility on the effect of taxes on gasoline prices. The American Petroleum Institute reports (PDF) that the federal gasoline tax is 18.4 cents per gallon.

The average state gasoline excise tax remained consistent at 18.2 cents per gallon. Other taxes add 9.15 cents per gallon to the average tax on gasoline. These other taxes include applicable sales taxes, gross receipts taxes, oil inspection fees, underground storage tank fees and other miscellaneous environmental fees. Adding these taxes and fees to the state excise taxes results in a volumeweighted average state tax of 27.4 cents per gallon.

API calculates the total tax burden on a state-by-state basis. The average total tax among all the states is 45.8 cents per gallon. Ohio has a total tax of 46.4, or 28 cents in non-federal taxes. New York and Hawaii have the highest total taxes, 60.8 and 60.4, respectively.

This makes one wonder about the cost-effectiveness of some of our road projects. In Houston in particular, one must really wonder, “Does that exit ramp bridge really need to be 10 stories high?”