States ring in new year with fuel rate changes
As the new year begins, several states are adjusting fuel tax rates, a reminder for working drivers that what happens at the pump can depend as much on policy as it does on market prices.
In Michigan, a constitutional requirement that fuel tax revenue be used for transportation is driving a major change. The state’s fuel excise tax is set to rise from 31 cents to 52.4 cents per gallon on Jan. 1. For drivers fueling in Michigan, that increase can show up quickly in per-fill costs, even if the posted base price of fuel is trending down.
New Jersey is also part of the year-end fuel tax picture. A law passed in 2024 gives the state authority to raise fuel taxes each year, setting the stage for ongoing, scheduled adjustments rather than one-off changes.
These state tax moves are arriving at a time when national pump prices are offering some relief. In Washington, (TNND) reported that prices at the gas pump are the lowest since the coronavirus pandemic and are still falling, easing pressure on household budgets as the calendar turns.
For trucking, the combination matters. When fuel prices drop, day-to-day operating costs can ease, but state-level tax increases can offset part of that benefit depending on where a driver buys fuel. As 2025 starts, Michigan’s jump and New Jersey’s updated framework are key examples of how fuel costs can change even in a down-price market.