The Alabama gas tax is 30 cents per gallon on gasoline and 31 cents per gallon on diesel as of July 1, 2025.1Alabama Department of Revenue. Motor Fuels Tax Rates Add the federal excise tax of 18.4 cents on gasoline and 24.4 cents on diesel, and every gallon you pump in Alabama carries about 48.4 cents of gasoline tax or 55.4 cents of diesel tax before any local fees.
Current State Rates
The per-gallon rates are set in Section 40-17-325 of the Code of Alabama. Gasoline sits at 30 cents, diesel at 31 cents. The one-cent gap between the two fuels has held through every recent adjustment, reflecting the heavier road wear from commercial trucks and equipment that run on diesel.
These are state excise rates only. A separate inspection fee is folded into the headline figures. Local and county fuel taxes may add a few cents in certain jurisdictions, which is covered further down.
How the Rate Got to 30 Cents
Alabama’s gasoline tax barely moved for 25 years before 2019. From 1992 through 2018, the excise sat at 16 cents per gallon, climbing to 18 cents in 2016 only because a two-cent inspection fee was rolled in. Inflation ate the rest, and the state ended up facing a multi-billion-dollar shortfall for road and bridge work.
The Rebuild Alabama Act, passed in 2019 and codified at Title 40, Chapter 17, Article 12A, did two things.2Justia. Alabama Code Title 40, Chapter 17 – Gasoline and Other Motor Fuels; Lubricating Oils First, it raised the gasoline tax by ten cents over three years: six cents on October 1, 2019, two cents on October 1, 2020, and a final two cents on October 1, 2021. That lifted gasoline to 28 cents and diesel to 29 cents.
Second, it built in an automatic adjustment. Every two years, the Alabama Department of Revenue reviews the National Highway Construction Cost Index and resets the per-gallon rate to track construction costs. Each biennial adjustment is capped at one cent, so the tax cannot jump suddenly. Those adjustments have taken gasoline from 28 cents to the current 30 cents.1Alabama Department of Revenue. Motor Fuels Tax Rates The legislature does not have to vote on each one-cent step; any change beyond the cap still requires new legislation.
Federal Tax on Top
The federal excise tax adds 18.4 cents to each gallon of gasoline and 24.4 cents to each gallon of diesel. Both figures include a 0.1-cent Leaking Underground Storage Tank surcharge. The federal rate has not changed since 1993 and is not indexed to inflation, so its real value has eroded considerably.
Federal revenue goes into the Highway Trust Fund, which finances interstate highways and other federal transportation work. Alabama’s share stays in Alabama.
Where Alabama’s Fuel Tax Money Goes
Amendment 93 of the Alabama Constitution, approved by voters in 1952, restricts state gasoline tax revenue to road construction, bridge maintenance, highway rights-of-way, and traffic regulation and enforcement. The legislature cannot shift fuel tax dollars into the general fund or spend them on unrelated programs.
Local-level taxes are a more mixed picture. Several counties, including Jefferson, Madison, Montgomery, and Mobile, collect additional fuel taxes under special legislative acts that predate the current statewide framework. Municipalities generally cannot impose new fuel taxes on their own authority. For aviation fuel, Section 40-17-357 bars any municipality from levying new taxes after October 1, 2012.
Who Doesn’t Pay the Tax
A few categories of fuel are exempt from the state excise tax.3Alabama Legislature. Alabama Code 40-17-329 – Exemptions
Government purchases. Motor fuel sold to the federal government, state agencies, counties, and registered municipalities is exempt. Federal purchases also skip the inspection fee; other exempt government entities still pay the inspection fee.
Dyed diesel. Diesel marked with a red dye is sold tax-free for off-highway use: farm tractors, irrigation pumps, construction equipment, generators, and the like. The exemption applies at the pump, so buyers do not need to file a refund claim. Using dyed diesel in a vehicle registered for highway use is illegal (more below).
Government refunds on taxed fuel. If an exempt government entity buys regular gasoline or undyed diesel with the tax already in the price, it can file a quarterly refund petition with the Department of Revenue on prescribed forms. Each petition covers a single quarter.4Legal Information Institute. Alabama Administrative Code r 810-8-1-.23 – Exempt Entity Petition For Refund For Tax-Paid Gasoline And Undyed Diesel Fuel
Federal off-road credit. If you pay the federal excise tax on fuel used off-highway for business, such as farming or construction, you can claim a credit on your federal return using IRS Form 4136. Only the person or business that actually burned the fuel qualifies as the ultimate user. The claim deadline follows the general federal refund rule: three years from filing the return for that tax year, or two years from paying the tax, whichever is later.5Office of the Law Revision Counsel. 26 U.S. Code 6511 – Limitations on Credit or Refund Miss the window and the credit is gone.
The Dyed Diesel Trap
Red-dyed diesel is cheap because it has not been taxed, and it is a tempting shortcut for anyone with both a tractor and a pickup. Don’t. Federal highway inspectors and state officers can dip-test fuel tanks during roadside checks, and the dye is unmistakable.
The IRS penalty is $1,000 or $10 per gallon of dyed fuel in the tank, whichever is greater, and the base figure escalates for repeat offenses. Alabama can stack its own penalties on top. A standard truck fuel tank holds 50 to 100 gallons, so a single stop can mean a four-figure fine before the base penalty even applies.
What You’ll Actually Pay
For a driver filling up in Alabama in 2026, the combined state-plus-federal tax is 48.4 cents per gallon on gasoline and 55.4 cents per gallon on diesel. Some counties layer a few additional cents on top under their special acts. The state portion will shift again at the next biennial review under the Rebuild Alabama indexing formula, by no more than one cent in either direction.