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Utah’s gas tax has long been a dependable funding source for transportation infrastructure, but with the rise of electric vehicles (EVs) and more fuel-efficient cars, the state is bracing for a shift in revenue collection.
Current Gas Tax System
Utah imposes a $0.5755 per gallon gas tax, with $0.3915 going to the state and the remainder allocated federally.
In fiscal year 2024, the state collected $451.8 million in gas tax revenue—a 5.6% increase from 2023.
“One hundred percent of [the gas tax] goes to fund transportation,” said Utah Tax Commission Deputy Executive Director Jason Gardner.
The Growing Challenge: Declining Gas Tax Revenue
More fuel-efficient vehicles mean less fuel consumption—but road maintenance costs remain high.
EV adoption cuts to traditional tax revenue, as these vehicles don’t rely on gasoline.
Fewer funds mean fewer infrastructure projects, potentially leading to deteriorating road conditions over time.
How Utah Is Adapting
Electric Vehicle Charging Tax: Since 2023, out-of-state EV drivers must pay a tax when charging in Utah.
EV Registration Fees: Utah EV owners either pay a flat fee or a per-mile charge to compensate for lost gas tax revenue.
Gas Tax Adjustments: In 2023, lawmakers lowered the gas tax by 2 cents but introduced new taxes on EV charging to offset revenue loss.
What’s Next?
While Utah has proactively adjusted its tax structure, experts believe it’s still not enough. Billy Hesterman, President of the Utah Taxpayers Association, argues that the system isn’t capturing enough revenue to cover the state’s growing transportation needs.
“We haven’t found an elegant solution yet,” Hesterman said, noting that politics often complicate tax reforms.
The Debate Continues
The key question remains: How can Utah fairly tax all drivers—including EV users—while ensuring road maintenance stays fully funded? As gasoline consumption declines, policymakers will need to balance efficiency, fairness, and feasibility in future transportation funding models.
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