Gasoline Tax Rates

Gasoline prices continue to rise so I thought it would be useful to look at the gasoline taxes in each state. New York has the highest gasoline tax rate of $0.49 per gallon while Alaska has the lowest gasoline tax rate of $0.08 per gallon. On top of the state and local gasoline taxes, the federal government taxes gasoline at $0.184 per gallon. The average gasoline tax when adding in the federal taxes is $0.488 per gallon.

For Tax Foundation data on state gasoline tax rates see this link

For state, local, and federal gasoline taxes depicted on a map see this link

Taxation of Meals in Major US Cities

The Tax Foundation published a study of the taxation of meals in major US cities. Meal taxes apply to prepared food eaten at a restaurant or take-out food, but sales of groceries are exempt from sales tax in 30 states. The Tax Foundation posits two justifications for the high taxes on prepared food. First, it can be argued that the high taxes on prepared food are a form of luxury tax aimed at higher-income people. Second, it can also be argued that the taxes are a form of tourism tax, because tourists are likely to be eating prepared food for most meals. The results of the ten US cities with the highest meal taxes are displayed in the table below. For the complete Tax Foundation report with meal tax data for the top 50 US cities in terms of population see this link.

State and Local Taxation of Nonresident Professional Athletes

A state’s application of its income tax to nonresident professional athletes is referred to by some as a “jock tax.” The “jock tax” dates back to 1991 when California extended its state income tax to Michael Jordan and the rest of the Chicago Bulls after the Bulls beat the Los Angeles Lakers in the NBA Finals. Illinois retaliated the following year, and now twenty of the twenty-four states with professional sports teams levy some form of a “jock tax.” I bring up the “jock tax” because the NBA All-Star Game is tonight in Orlando, FL, which happens to be one of four states with professional sports teams that does not have a personal income tax. Last year I wrote a paper on the “jock tax,” describing how it works, peculiar approaches that states use, problems with the “jock tax,” and the approaches taken by states that do not have a personal income tax. The paper describes the benefit the players receive in playing in Florida tonight, along with some of the headaches faced by professional athletes in having to play games in so many taxing jurisdictions. I imagine the game will be that much better tonight since the players will not be worrying about being taxed as nonresident professional athletes in Florida.