Raising the gas tax requires a legislative act by whichever government levies it. At the federal level, that means Congress passing a bill and the president signing it. At the state level, it means a state legislature, a voter-approved ballot measure, or in a growing number of places, an automatic indexing formula that adjusts the rate without any new vote at all. Understanding how gas tax increases work starts with knowing who has the authority, what procedural hurdles they face, and why the federal rate has stayed frozen at 18.4 cents per gallon since 1993.
Who Can Actually Raise the Gas Tax
Only Congress can change the federal fuel tax. The rate is set in statute at 26 U.S.C. § 4081, and changing a statute takes a statute. The Constitution’s Origination Clause requires revenue bills to start in the House of Representatives, though the Senate can amend them.1Congress.gov. ArtI.S7.C1.1 Origination Clause and Revenue Bills From there a gas tax bill follows the same path as any other tax measure: introduction, committee hearings, floor votes in both chambers, and a presidential signature.
States set their own fuel tax rates independently, drawing authority from their own constitutions and statutory codes. That is why combined federal-and-state rates vary so widely from one state to the next. Some states also delegate limited fuel-tax authority to cities and counties through enabling legislation, letting local governments add a few cents per gallon within their borders. Where that delegation exists, local rates typically run from about 1 to 16 cents per gallon, always inside limits the state legislature has drawn.
The Legislative Path and Why It Stalls
The straightforward route to a higher gas tax is a bill. A lawmaker introduces it, committees hold hearings on projected revenue and infrastructure shortfalls, both chambers vote, and the executive signs. The current federal rate was set this way by the Omnibus Budget Reconciliation Act of 1993, and the same process would be needed to change it.2Federal Highway Administration. When Did the Federal Government Begin Collecting the Gas Tax
The political reality is harder. Voting to raise a tax tied to something as visible as the price posted on every gas station sign is a career risk few politicians volunteer for. That reluctance is a large part of why the federal rate hasn’t moved in more than three decades, even as inflation has eroded roughly half its purchasing power. At the state level the calculus varies. States with visibly failing roads and bridges have found the votes; others have locked themselves into procedural rules that make an increase substantially harder to pass.
Supermajority Requirements
Sixteen states have written supermajority requirements into their constitutions or statutes. Depending on the state, the threshold to raise a tax might be three-fifths, two-thirds, or three-fourths of the legislature. In some of these states the rule covers every tax; in others it applies only to specific types. A simple majority isn’t enough. Under a supermajority rule, a determined minority can block a gas tax bill that most lawmakers actually support, which is often exactly the point.
Ballot Measures and Voter Approval
Some states let voters decide directly. Supporters gather a required number of signatures from registered voters to place the question on a general election ballot, and the increase takes effect only if voters approve it. This route bypasses legislative gridlock but brings its own difficulties. Campaigns on both sides can be expensive, and voters tend to be skeptical of anything labeled a tax increase unless the spending purpose is clearly spelled out. Ballot measures have also worked in reverse: several states have used them to add constitutional “lockbox” protections after 2010, restricting how fuel tax money can be spent once it’s collected.
Automatic Indexing: Raising the Tax Without a Vote
Because raising gas taxes through a vote is politically painful, a growing number of states have adopted automatic adjustment mechanisms. These tie the tax rate to an economic measure so it moves up (or occasionally down) without any new legislation. Between January 2025 and January 2026 alone, nineteen states raised their gas tax rates while seven lowered them, and much of that movement came from indexing formulas rather than fresh legislative votes.3U.S. Energy Information Administration. Many States Slightly Increased Their Taxes and Fees on Gasoline
The most common approach links the per-gallon rate to the Consumer Price Index, with updates typically taking effect on July 1 or January 1. Other states peg the tax to wholesale fuel prices, so the rate fluctuates with the market. A few use construction-cost indexes that more directly track the price of the materials the revenue is meant to buy. The mechanism is chosen once, by ordinary legislation, and then does its work automatically each year.
Floors and Caps
Most states that use indexing build in guardrails. A floor prevents the tax from dropping below a set level even if the underlying index falls, protecting revenue from collapse. A cap limits how much the rate can rise in any single adjustment period, preventing sticker shock. Some states cap increases at a fraction of a cent per gallon per adjustment; others use percentage limits. The point of both is to keep the automatic mechanism politically survivable: predictable enough that lawmakers don’t feel pressure to repeal it the next time the index moves sharply.
Why the Pressure to Raise the Tax Keeps Building
The frozen federal rate has created a real fiscal problem. Federal gas tax revenue flows into the Highway Trust Fund, established under 26 U.S.C. § 9503, which splits collections between a Highway Account and a Mass Transit Account. Of the 18.4 cents collected on each gallon of gasoline, 2.86 cents goes to transit and the rest to highways.4Office of the Law Revision Counsel. 26 USC 9503 – Highway Trust Fund But the fund now spends far more than it collects. Since 2008, Congress has transferred approximately $275.2 billion from general tax revenues into the fund just to keep it solvent.5Congress.gov. Table 2 – Transfers to the Highway Trust Fund
Without further transfers or a rate increase, the fund faces insolvency as early as 2028, which would trigger automatic spending cuts of roughly 46 percent on highway and transit projects nationwide. The math driving that shortfall is straightforward. Americans drive more fuel-efficient cars than they did in 1993. A growing share of vehicles run on electricity and generate no gas tax at all. Construction costs have more than doubled. A fixed per-gallon tax brings in less real revenue each year while the infrastructure it funds gets more expensive to maintain.
States have responded to the electric vehicle piece with annual registration surcharges on EVs and hybrids, currently ranging from $50 to $400 for fully electric vehicles depending on the state. A more ambitious response is the per-mile road usage charge, which several states have tested in pilot programs. Under such a system, drivers report their mileage and pay a fee for each mile driven regardless of what powers the vehicle, with credits for any gas tax already paid. These programs are still largely in the research phase, and privacy concerns about mileage tracking, plus the administrative work of collecting from millions of individual drivers, remain significant obstacles.
Whatever replaces or supplements the per-gallon tax, the mechanism for raising it will look familiar: a bill through a legislature, a measure on a ballot, or a formula that does the work automatically once someone has voted it into place.