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The U.S. Gasoline Tax: Time for a Change


Although the federal gasoline tax played multiple roles in financing surface transportation infrastructure in the United States, experts did not agree on the tax's purpose. Some argued that it was essentially a fee for users of the nation's federally supported highways. Others suggested that it should play a more prominent role in environmental, energy, and transportation policy by correcting for driving-related externalities. Still others suggested that it should be used to reduce the federal budget deficit. Finally, the tax itself had remained at the same level since 1993, and with the Highway Trust Fund virtually insolvent, many experts believed it was time for an increase. The case presents a background on the U.S. federal gasoline tax, an overview of the market for gasoline in the United States, and survey of gasoline taxes in U.S. states as well as several other countries around the world.




David Besanko, Saahil Malik, Vidhyashankar Balasubramanian

Date Published


Besanko, David, Saahil Malik, and Vidhyashankar Balasubramanian. The U.S. Gasoline Tax: Time for a Change. Case 5-409-751 (KEL517).


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