Small Business and Entrepreneurship Council

The States and Energy Taxes

December 10, 2010

Energy & Entrepreneurs

Small Business Survival Index 2010: Gas and Diesel Taxes

by Raymond J. Keating

Most politicians like to talk about the need for affordable energy. They're also likely to throw in some points about "clean energy" and "energy independence."

Those latter two phrases tend to be soft, politically correct, politically tested tidbits that can mean different things to different people.

But "affordable" is pretty straightforward. And as for our elected officials, the question is: do their policies make energy more or less affordable for small businesses and consumers?

Clearly, energy taxes affect the affordability of energy. And that most certainly is the case with taxes at the gas or diesel pump.

The "Small Business Survival Index: Ranking the Policy Environment for Entrepreneurship Across the Nation" ranks the 50 states and District of Columbia according to 38 government-imposed or government-related costs that impact entrepreneurs, small businesses, investors and the economy. Both gas and diesel and taxes are included, and how the states rank in each case follows:

State Gas Taxes (Dollars Per Gallon)

Rank	State	Gas Tax
1	Alaska	0.080
2	Wyoming	0.140
3	New Jersey	0.145
4	South Carolina	0.168
5	Oklahoma	0.170
6	Missouri	0.173
7t	Mississippi	0.188
7t	New Mexico	0.188
9	Arizona	0.190
10	Virginia	0.195
11	New Hampshire	0.196
12t	Louisiana	0.200
12t	Texas	0.200
14	Georgia	0.208
15	Alabama	0.209
16	Tennessee	0.214
17	Arkansas	0.218
18t	Colorado	0.220
18t	Iowa	0.220
20	Kentucky	0.225
21t	Delaware	0.230
21t	North Dakota	0.230
23t	Dist. of Columbia	0.235
23t	Maryland	0.235
23t	Massachusetts	0.235
26	South Dakota	0.240
27	Utah	0.245
28	Vermont	0.247
29t	Idaho	0.250
29t	Kansas	0.250
29t	Oregon	0.250
32	Minnesota	0.272
33	Montana	0.278
34t	Nebraska	0.280
34t	Ohio	0.280
36	Maine	0.310
37t	North Carolina	0.322
37t	West Virginia	0.322
39	Pennsylvania	0.323
40	Wisconsin	0.329
41	Rhode Island	0.330
42	Nevada	0.331
43t	Florida	0.340
43t	Indiana	0.340
45	Michigan	0.351
46	Washington	0.375
47	Illinois	0.394
48	Connecticut	0.418
49	New York	0.444
50	Hawaii	0.448
51	California	0.466

State Diesel Taxes (Dollars Per Gallon)

Rank	State	Diesel Tax
1	Alaska	0.080
2t	Oklahoma	0.140
2t	Wyoming	0.140
4	South Carolina	0.168
5	Missouri	0.173
6	New Jersey	0.175
7	Tennessee	0.184
8	Mississippi	0.188
9	Arizona	0.190
10	Kentucky	0.195
11t	New Hampshire	0.196
11t	Virginia	0.196
13t	Louisiana	0.200
13t	Texas	0.200
15	Colorado	0.205
16	Georgia	0.206
17	Alabama	0.219
18	Delaware	0.220
19t	Arkansas	0.228
19t	New Mexico	0.228
21	North Dakota	0.230
22t	Dist. of Columbia	0.235
22t	Iowa	0.235
22t	Massachusetts	0.235
25	South Dakota	0.240
26t	Maryland	0.243
26t	Oregon	0.243
28	Utah	0.245
29	Idaho	0.250
30	Kansas	0.270
31	Nebraska	0.274
32	Minnesota	0.276
33	Ohio	0.280
34t	Montana	0.286
34t	Nevada	0.286
36	Vermont	0.290
37	Florida	0.296
38	West Virginia	0.321
39t	Maine	0.322
39t	North Carolina	0.322
41	Michigan	0.328
42	Wisconsin	0.329
43	Rhode Island	0.330
44	Washington	0.375
45	Pennsylvania	0.392
46	Connecticut	0.396
47	Illinois	0.430
48	Indiana	0.438
49	New York	0.439
50	Hawaii	0.467
51	California	0.487

It's pretty clear that at a majority of state elected officials in places like New York, Hawaii, and California - and the other states that rank poorly - cannot be taken seriously when they speak of the need for affordable energy. Policy reality directly opposes such rhetoric.

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Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.

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