Bloomberg BNA: Will Massachusetts’ Rejection of Inflation-Adjusted Gas Tax Have Federal Implications?

States have varying gas tax rate structures, which can be boiled down to one of two general forms: a fixed-rate tax or a variable-rate tax.  Flat-rate gas taxes, like those in now Massachusetts and New Hampshire, collect a certain number of cents per gallon of gas purchased.  Meanwhile, variable-rate taxes are calculated one of several ways—based on the price of gas (similar to a traditional sales tax), based on a broader measure of the economy’s inflation, or based on a hybrid of both the price of gas and an inflation measure, according to a May 2014 policy brief from the Institute on Taxation and Economic Policy (ITEP).

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