On average, Tennessee drivers pay approximately $300 annually in gas taxes, depending on how many miles they drive per year and the average miles per gallon their vehicles get, according to the Tennessee Department of Transportation. From this, 90% of funds go back to public roads, including construction, maintenance, preservation and grants for road projects. The remaining 10% is used for administration and other costs.
Beginning July 1, this total will include $0.26 in state taxes, following the passage of House Bill 534, which was signed into law in 2017. Prior to the bill, the state tax rate was $0.24 per gallon and had been since 1989.
This, combined with the federal gas tax rate of $0.184, makes for a total rate of $0.444 per gallon.
Compared with the rest of the country, Tennessee drivers pay nearly 10 cents less per gallon than the national average, and the state ranks 31st in the nation for gas taxes, according to TDOT.