The Michigan gas tax is 52.4 cents per gallon as of January 1, 2026, and it applies equally to gasoline and diesel.1State of Michigan. Tax Rates for Motor Fuel and Alternative Fuel Add the 18.4-cent federal excise tax and a 1-cent state environmental fee, and about 71.8 cents of every gallon of regular gas you buy goes to taxes and fees before the retailer sets its price.
The Current Rate
Michigan charges a flat amount per gallon rather than a percentage of the pump price. The 52.4-cent rate covers gasoline, diesel, and alternative fuels like liquefied petroleum gas on a gallon-equivalent basis.1State of Michigan. Tax Rates for Motor Fuel and Alternative Fuel Suppliers pay the tax when fuel leaves the terminal, well before it reaches your local station, so it’s already built into the posted price.2Michigan Legislature. MCL 207-1008 – Motor Fuel Tax Act
Because the tax is fixed per gallon, it doesn’t move with crude oil prices. A gallon selling for $3.00 and a gallon selling for $4.00 both carry the same 52.4 cents in state excise tax.
What Changed in 2026
Through the end of 2025, Michigan taxed fuel twice: a 31.0-cent excise tax plus the state’s general 6% sales tax on the retail price. Your total state tax per gallon moved with the pump price, so expensive gas meant more tax.3State of Michigan. Fuel Tax Changes
Public Acts 17 through 20 of 2025, signed on October 7, 2025, scrapped that structure. Starting January 1, 2026, fuel purchases are fully exempt from Michigan’s 6% sales tax and 6% use tax, and the excise tax rose from 31.0 to 52.4 cents per gallon to replace that revenue.4Michigan Department of Treasury. Notice Regarding Fuel Tax Changes from Public Acts 17-20 of 2025 The state describes the swap as revenue-neutral: a predictable flat rate replacing a volatile percentage-based one.3State of Michigan. Fuel Tax Changes
Yearly Inflation Adjustments
The 52.4-cent rate won’t hold indefinitely. The Michigan Department of Treasury must recalculate it every January 1, multiplying the prior year’s rate by one plus the lesser of 5% or the actual inflation rate, then rounding up to the nearest tenth of a cent. The 5% cap keeps any single-year increase to roughly 2.6 cents at current levels. Treasury has to publish the new rate at least 30 days before it takes effect.2Michigan Legislature. MCL 207-1008 – Motor Fuel Tax Act
Federal Tax and Environmental Fee
Every gallon sold in the United States also carries a federal excise tax: 18.4 cents on gasoline and 24.4 cents on diesel.5U.S. Energy Information Administration. How Much Tax Do We Pay on a Gallon of Gasoline and Diesel Fuel? Those rates haven’t changed in decades. The federal tax is collected from producers and importers, so it shows up only as part of the pump price, never as a line item on your receipt.
Michigan also charges a 1-cent-per-gallon environmental protection regulatory fee on refined petroleum products. It funds cleanup of underground storage tank contamination and is collected from refiners and importers alongside the excise tax.6Michigan Legislature. MCL 324-21508 – Environmental Protection Regulatory Fee
Total Tax Per Gallon
Stacking the three layers gives you the full tax load on each gallon:
- Gasoline: 52.4¢ state excise + 18.4¢ federal excise + 1.0¢ environmental fee = about 71.8¢ per gallon.
- Diesel: 52.4¢ state excise + 24.4¢ federal excise + 1.0¢ environmental fee = about 77.8¢ per gallon.
A 15-gallon fill-up of regular gasoline sends roughly $10.77 to taxes and fees. With the sales tax piece gone as of 2026, that amount no longer changes when the pump price does.
Electric and Plug-In Hybrid Fees
Drivers who don’t buy gasoline still contribute to road funding through an annual registration surcharge. Under current law, the surcharge is $5.00 for each cent the gasoline tax exceeds 19 cents for fully electric vehicles, and $2.50 per cent above 19 cents for plug-in hybrids.7Michigan Legislature. EV and PHEV Registration Fees S.B. 593
At the 2026 rate of 52.4 cents, that formula works out to roughly $168 per year for an EV and $84 for a plug-in hybrid, on top of standard registration costs. The surcharge rises automatically each year as the fuel tax climbs with inflation.7Michigan Legislature. EV and PHEV Registration Fees S.B. 593 Senate Bill 593 would lower the per-cent multiplier, but it had not been enacted at the time of writing.
Refunds for Off-Road Use
If you buy taxed fuel in Michigan and use it off the public roads — farm equipment, generators, construction machinery — you can apply for a refund of the state excise tax. The tax exists to fund roads, so fuel that never touches one shouldn’t carry the cost. Snowmobiles, off-road recreational vehicles, and boats don’t qualify.8Michigan Legislature. MCL 207-1033 – Use of Motor Fuel for Nonhighway Purposes The refund covers only the state excise tax; the federal tax and environmental fee are handled through separate processes.
Where the Revenue Goes
Ninety-eight percent of state motor fuel tax collections go into the Michigan Transportation Fund, with the remaining 2% supporting a Recreation Improvement Account.3State of Michigan. Fuel Tax Changes Within the Transportation Fund, a formula set by Public Act 51 of 1951 splits the money four ways: 34.4% for state highways, 34.4% for county roads, 19.2% for cities and villages, and 9.8% for public transit. State constitutional and statutory limits prevent the legislature from redirecting fuel tax dollars to general fund spending unrelated to transportation.9House Fiscal Agency. FY 2025-26 Budget Briefing: Transportation