Happy New Year: Utah will not hike the gasoline tax to kick off 2018

Tax is based on average annual price per gallon — and fuel remained consistently low during 2017.<br>

(Francisco Kjolseth | Tribune file photo) Gasoline taxes in Utah will not increase for 2018, thanks to formulas based on average prices for the previous year — which were consistently low.

Low gasoline prices throughout 2017 are bringing drivers something extra to cheer as they ring in the new year: no increase in Utah’s fuel tax.

In 2015, the Legislature passed a law that automatically raises the state gasoline tax once a year if average annual fuel prices have risen.

The state charges 16.5 percent of the statewide average annual rack price for gasoline — and makes an adjustment to the price paid at the fuel pump once a year, on New Year’s Day.

“Following this method, motor fuel and special fuel tax [on diesel] will not change for 2018,” according to a bulletin from the Utah State Tax Commission.

So don’t blame any New Year’s Day increases at the pump on a tax hike.

The AAA travel services company, which tracks gasoline prices nationally, said this week that extra demand for gasoline from people driving more during the holidays has led to a seasonal increase of about two cents a gallon nationally.

A customers prepares to pump gas on Monday, Dec. 7, 2015, at a gas station in Pembroke, Mass. The price of a barrel of oil fell Monday to a nearly seven-year low. With OPEC's decision to keep pumping at current levels, analysts expect oil to remain relatively cheap well into 2016 and maybe longer. (AP Photo/Stephan Savoia)

Utah’s portion of the 2018 fuel tax for gasoline and diesel will remain at 29.4 cents per gallon. The federal government charges an additional 18.4 cents per gallon for gasoline, and 24.4 cents for diesel.

AAA reported Friday that prices for regular gasoline in Utah currently average $2.41 a gallon, a bit lower than the national average of $2.48. Current Utah averages are down by about a penny compared to last week, and down by 10 cents a gallon compared to a month ago.

Average prices around the state can vary widely.

AAA reports that Utah’s lowest current average prices for regular gasoline are in the Provo-Orem area at $2.28 a gallon. The highest are in St. George, at $2.57.

Other current averages include $2.34 a gallon in the Salt Lake City area; $2.40 in Ogden; and $2.50 in Logan.

AAA says the highest recorded statewide average price charged for gasoline in Utah was $4.22 a gallon, which occurred July 18, 2008. The highest ever charged for diesel was $4.81 a gallon on June 14, 2008.

Through the decades, revenue from gasoline tax has generally declined — in part because cars get better mileage and motorists buy less fuel per mile traveled, and because electric, hybrid and natural-gas vehicles escape most or all of such taxes.

Because of that, a legislative task force has been looking at ways to change how to fund transportation, which is now heavily subsidized by the general sales tax.

Gov. Gary Herbert recently said the state will conduct a small pilot project to look at charging a tax based on miles driven (as recorded by odometers) instead of charging a per-gallon gas tax. Several states are doing similar research.

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