Maryland Gas Tax Increased July 1: Here’s How Much More Drivers Are Paying

ANNAPOLIS, Md. — While global oil markets, seasonal demand and local competition all influence what drivers pay at the pump, the Maryland gas tax is another important piece of the overall price. Beginning July 1, Maryland drivers are paying slightly more under the state’s annual motor fuel tax adjustment.

The gasoline tax increased from 46 cents to 46.6 cents per gallon, while the diesel tax rose from 46.75 cents to 47.45 cents per gallon, according to the Maryland Comptroller’s Office motor fuel tax guidance. Understanding how these annual adjustments work can help drivers make sense of yearly changes and better anticipate transportation costs.

See more new laws now in effect here.

What Is The Maryland Gas Tax?

The Maryland gas tax is a state tax collected on motor fuel sold for use on public roads. It is separate from the federal fuel tax and is generally included in the price consumers see at the pump rather than added during checkout.

Revenue generated from the tax helps support transportation-related needs. That includes maintaining roads, improving highways, repairing bridges and funding other transportation infrastructure projects across the state. Because transportation systems require ongoing maintenance, fuel taxes have long been one way states generate revenue from road users.

Drivers may not notice the tax directly during each fill-up because it is built into the overall cost of gasoline and certain other motor fuels.

Maryland Gas Tax Increased July 1

Under Maryland law, the state’s motor fuel tax is adjusted annually using a statutory formula, rather than requiring the General Assembly to approve a new tax rate each year.

Effective July 1, the state gasoline tax increased from 46 cents to 46.6 cents per gallon, while the diesel tax increased from 46.75 cents to 47.45 cents per gallon.

The Comptroller’s Office is required to announce updated motor fuel tax rates by June 1 for implementation each July 1.

Maryland’s motor fuel tax is calculated under a statutory formula that includes an adjustment tied to the Consumer Price Index (CPI), along with another component based on average fuel prices. As a result, the tax can change each year without lawmakers voting on a new rate.

Revenue from the tax is deposited into Maryland’s Transportation Trust Fund, which helps support road improvements, bridge repairs and other transportation infrastructure projects across the state.

Why Does The Gas Tax Change?

Unlike a fixed tax that remains the same year after year, Maryland’s motor fuel tax is adjusted automatically under state law using a statutory formula. The formula includes an inflation adjustment and another component tied to average fuel prices, allowing the tax to change annually without new legislation.

As a result, drivers may see small changes each July even if pump prices have changed very little during the year.

Because several factors affect prices at once, a change in the Maryland gas tax does not necessarily lead to an identical increase or decrease in the price displayed on station signs.

Why Fuel Prices Vary Across Maryland

Drivers may notice different prices depending on where they fill up.

Communities with heavy commuter traffic, tourism or higher operating costs may see different pricing than neighboring areas. Stations located near major highways can also price fuel differently than those serving primarily local neighborhoods.

Residents of St. Mary’s, Calvert and Charles counties may compare prices with nearby communities before filling up, while commuters traveling into Anne Arundel County, Baltimore or Washington may encounter different market conditions along their routes.

These regional differences are common and do not necessarily reflect changes in the state tax.

How The Gas Tax Supports Transportation

Transportation infrastructure requires continuous investment. Roads experience wear from weather, traffic and aging materials, while bridges and other facilities need regular inspections and maintenance.

Motor fuel tax revenue is deposited into Maryland’s Transportation Trust Fund and helps pay for transportation projects across the state, including road maintenance, bridge repairs and other infrastructure improvements.

While funding priorities may change over time, transportation agencies generally rely on multiple revenue sources to maintain existing infrastructure and plan future improvements.

For many Maryland residents, reliable roads are essential for commuting, emergency services, school transportation and commercial deliveries. Maintaining that network benefits communities across urban, suburban and rural parts of the state.

What Drivers Should Expect Each Year

Motorists should anticipate that fuel prices will continue to fluctuate throughout the year. Even without changes to taxes, gasoline prices can rise or fall because of supply issues, refinery maintenance, severe weather or changes in consumer demand.

Maryland drivers should also expect the state’s motor fuel tax to be reviewed annually, with any updated rates taking effect on July 1 under the existing statutory formula.

Drivers can prepare by monitoring local fuel prices, planning longer trips efficiently and recognizing that seasonal increases are common during periods of higher travel demand.

Budget-conscious households may also benefit from comparing prices among nearby stations, combining errands into fewer trips and keeping vehicles properly maintained. Proper tire inflation and regular maintenance can improve fuel efficiency, helping offset higher gasoline costs over time.

Frequently Asked Questions

---