Saving & Spending Taxes

10 States With the Nation's Lowest Gas Taxes

Low gas taxes are a win for your budget.

By Sarah Sharkey , Edited by Chris Kissell

Updated Sept. 1, 2026

Add Us On Google

Depending on where you live, gas taxes can have a significant impact on your budget. Luckily for drivers in some states, gas taxes are relatively low, which means it costs less to fuel up their vehicles.

According to a Tax Foundation analysis, these are the states with the lowest gas taxes in the country. That means moving to one of these places can be one of the smartest money moves if you own a car.

Editor's note: All tax amounts have been rounded to the nearest cent.

Set up direct deposit - pocket $400

Set up an eligible direct deposit with SoFi Checking and Savings and you could pocket a bonus of up to $400. Make the switch, set up direct deposit, earn the bonus. It basically takes no extra work at all other than following these steps.

Why people are switching: This account earns up to an insane 4.00% APY¹ Earn up to 4.00% Annual Percentage Yield (APY) on one SoFi Savings account with a 0.90% APY Boost (added to the 3.10% APY as of 5/28/26) for up to 6 months. Open your first SoFi Checking and Savings account and receive eligible direct deposits OR qualifying deposits of $5,000 every 31 days by 12/31/26. Rates are variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#4">sofi.com/banking#4</a>. SoFi Bank, N.A. Member FDIC. on savings for up to six months (3.10% APY standard + 0.90% APY boost) on top of that $50 or $400 bonus.² New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received within 25 calendar days of your first Eligible Direct Deposit of $1 or more) OR $400 (with at least $5,000 total Eligible Direct Deposits received within 25 calendar days of your first Eligible Direct Deposit of $1 or more). Cash bonus amount will be based on the total amount of Eligible Direct Deposit received within 25 calendar days of your first Eligible Direct Deposit of $1 or more. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 5/15/2026 and will be available through 12/31/26. See full bonus and annual percentage yield (APY) terms at <a href="https://www.sofi.com/banking/checking-offer/">sofi.com/banking/checking-offer/</a> That's way better than the measly 0.38% APY (as of 06/15/26)³ Based on <a href="https://www.fdic.gov/national-rates-and-rate-caps">this</a> FDIC data, as of 6/15/26. national average savings accounts offer.

No monthly fees and no surprises. Open your account and earn up to a $400 bonus

North Dakota

Tax rate per gallon: 23 cents

North Dakota drivers enjoy relatively low gas taxes and solidly middle-of-the-pack gas prices.

Drivers should keep other costs — such as car insurance and registration — in mind when building a budget for their vehicle.

Shopping for cheaper auto insurance? Enter your zip code here to get started.

Delaware

Tax rate per gallon: 23 cents

Delaware boasts a low gas tax, but drivers face relatively stable gas prices in the state, at an average of $2.72.

Still, bordering states such as Pennsylvania and Maryland have significantly higher gas prices.

Mississippi

Tax rate per gallon: 21 cents

Mississippi has a gas tax of around 21 cents. The low gas taxes contribute to the state's low gas prices, which currently sit at an average of $2.49.

With close proximity to the large refineries on the Gulf Coast, Magnolia State residents tend to enjoy cheaper gas costs.

Resolve $10,000 or more of your debt

National Debt Relief could help you resolve your credit card debt with an affordable plan that works for you. Just tell them your situation, then find out your debt relief options.⁴ Please note that all calls with the company may be recorded or monitored for quality assurance and training purposes. Clients who are able to stay with the program and get all their debt settled realize approximate savings of 45% before fees, or 20% including our fees, over 24 to 48 months. All claims are based on enrolled debts. Not all debts are eligible for enrollment. Not all clients complete our program for various reasons, including their ability to save sufficient funds. Estimates based on prior results, which will vary based on specific circumstances. We do not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. We do not assume consumer debt, make monthly payments to creditors or provide tax, bankruptcy, accounting or legal advice or credit repair services. Not available in all states. Please contact a tax professional to discuss tax consequences of settlement. Please consult with a bankruptcy attorney for more information on bankruptcy. Depending on your state, we may be available to recommend a local tax professional and/or bankruptcy attorney. Read and understand all program materials prior to enrollment, including potential adverse impact on credit rating. "Debt-Free" applies only to enrolled credit cards, personal loans, and medical bills. Not mortgages, car loans, or other debts. Results vary.

Louisiana

Tax rate per gallon: 20 cents

Louisiana is home to many oil refineries and low gas taxes. When these factors are combined, it leads to relatively low gas prices for Bayou State residents.

But for Louisiana drivers, other car costs can take a big bite out of their budget. The state has the highest car insurance costs in the nation, according to Insure.com.

Texas

Tax rate per gallon: 20 cents

Texas is another place boasting many oil refineries, which contribute to its relatively low gas prices. Because the state is close to refineries, gas delivery costs are cheaper.

Oklahoma

Tax rate per gallon: 20 cents

Oklahoma's proximity to oil refineries and its relatively low gas taxes keep driver costs low. The state boasts some of the cheapest gas prices in the country, with an average cost of $2.29 per gallon, helping keep more cash in your wallet.

Make Money: 8 things to do if you're barely scraping by financially

Arizona

Tax rate per gallon: 19 cents

Arizona has a gas tax that matches New Mexico's. However, gas prices in Arizona are $3.08, compared to New Mexico's $2.68.

The increased gas costs for Arizona residents may be partially attributed to the increased distance from the refineries of the Gulf Coast.

New Mexico

Tax rate per gallon: 19 cents

New Mexicans enjoy relatively affordable gas prices, making it a great place to fill up for residents of Utah, Arizona, and Colorado who pass through.

Although the state's drivers get a break on gas taxes, they still have to pay other taxes. Such taxes include an income tax ranging from 1.7% to 5.9% and an average combined state and local sales tax rate of 7.67%.

Hawaii

Tax rate per gallon: 19 cents

Hawaii's gas tax rate is a relatively low 19 cents. But Hawaiians still pay some of the highest gas prices in the nation, at an average of $4.42.

On top of high gas prices, Hawaii residents face a high cost of living that is the price for putting down roots in paradise.

Earn $100 cash rewards bonus with this incredible card

The Wells Fargo Active Cash^® Card (Rates and fees) has no annual fee and you can earn a $100 cash rewards bonus after spending $500 in purchases in the first 3 months.

Cardholders can also earn unlimited 2% cash rewards on purchases.

The best part? There's no annual fee.

Click here to apply now.

Alaska

Tax rate per gallon: 9 cents

Residents of Alaska pay the lowest gas taxes in the country. However, Alaskans may still feel pain at the pump because the average price per gallon is $3.58, which is higher than the national average of $2.85.

The state's remoteness and small gasoline market contribute to above-average gas prices.

Bottom line

Drivers face very different gas taxes depending on where they live. If you are fortunate to live in a state with low gas taxes, it can help you get ahead financially.

So, if you have plans to relocate to a new city and you typically spend many hours behind the wheel of a car, one of the states on this list might be a good place to call home.

More from FinanceBuzz:

Intro APR on purchases and balance transfers
$0 annual fee
Apply Now

Get a 0% intro APR for 15 months on purchases and balance transfers; balance transfer fee applies. Then 17.49% to 26.49% Standard Variable Purchase APR applies, based on credit worthiness
INTRO OFFER: Unlimited Cashback Match for all new cardmembers. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300
Earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases
Redeem cash back for any amount. No annual fee
Terms and conditions apply

4.7

Apply Now

on Issuer's secure website

Read Card Review

Intro Offer

INTRO OFFER: Unlimited Cashback Match for all new cardmembers. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300

Annual Fee

Why we like it

North Dakota

Delaware

Mississippi

Louisiana

Texas

Oklahoma

Arizona

New Mexico

Hawaii

Alaska

Bottom line

Unlock the Best Banking Deals and Bonuses

Must-Read Buzz