Skip to comments.Breakdown of Gas Prices
Posted on 05/07/2011 8:26:00 AM PDT by originalbuckeye
Can anyone provide a current breakdown of gas prices? I want to forward to my friends who think that Big Oil is the big winner when prices spike up. I'm assuming that all the Fed, State and Local taxes are the main reason. Thanks.
Talk about “windfall profits.” That’s what the GOVERNMENT gets with their taxes on gasoline as it goes up. They did nothing to earn it!
Ever hear of Google?
google the words: breakdown of gas cost
First result of many:
Oil companies make about 7 cents per gallon, the gas station owner makes about 8 cents a gallon, states charge sales tax (CA its about 8% a gallon), the feds charge an excise tax which is fixed (I think its about 42 cents a gallon), states charge an excise tax which is fixed (CA its about 18 cents per gallon).
Probably can find a chart somewhere on the internet.
High gas prices result from high oil prices, because oil is the primary input cost for gasoline. “Big Oil” doesn’t set the oil prices. The commodities markets do. “Big Oil” earns HUGE profits when oil prices go higher, because the market has increased the value of what they sell. States DO indeed add on taxes to the cost of gasoline as well. Some higher than others. The massive printing of ‘money’ by the Federal Reserve couldn’t be helping matters either.
Someone correct me if I am wrong, but I believe most of the taxes on gas are per gallon not the dollar amount.
There are probably more links... google it.
Depends on the tax. Road tax, yes per gallon. Corporate taxes and some states sales taxes are based on the dollar amount.
Perhaps he should look into the declining value of the dollar, thanks in large part to the idiotic policies of the Fed.
A lot of good information on here, and remember:
Government makes much more profit on gas than does ANY private company in the entire exploration, drilling, distribution, refinement, sales process. This includes “big oil” companies.
On the retail end the local gas station or 711 received its gasoline and diesel fuel about every 10 days on average.
Given that the price changed on a daily basisi during those 10 days it was evident that the retailers were changing the price of gas based on the reported oil speculators activity and not those EVIL oil companies.
Nothing has changed, especially the Economic Ignorance of gas purchasing public!
Thanks for the question. This is a good thread to bookmark IMO.
Don't be rude on here. We are amoung friends.
And Big Government earns ever HUGER tax revenues by taxing these increasing profits.
The only problem is that the article you referenced is not accurate. The pumps in AZ show the breakdown, and Federal taxes are 18 cents with state and local taxes another 18 cents.
I just read a few days ago that for every gallon of gas, the oil companies make 7 cents and the government makes 43 cents per gallon. Disgusting, can you imagine having a business and the government making more profit off your blood sweat and tears than you do?
The taxers make the most profit and the taxee gets lubed.
This is truly disgusting.
Not really. The government gets 18.4 cents per gallon. Therefore, regardless of the price of a gallon of gas, the feds still only get 18.4 cents per gallon.
No, the oil companies make 7%, so if a gallon is $4 they only make $0.28. The federal gasoline tax is 18.4 cents per gallon, hence they only get 18.4 cents regardless of the price of gas.
Now if the price of gas is $2, then the companies only make 14 cents and the Feds make 18.4 cents and that certainly isn’t fair to the oil companies that spend billions to go into hostile environments to drill for oil for the betterment of people.
Snip: Gas prices keep rising nationwide. But how much you actually pay is affected by your income and local economy. Mississippi residents spend a whopping 14.2% of their income on gas.
the federal excise tax and state highway taxes are charged per gallon. here in illinois, additional state, county, and city SALES taxes are charged per dollar, including the per gallon taxes charges. so we get to pay tax on tax.
What states charge sales tax on gasoline. I’ve traveled in all 50 of them and don’t ever remember paying more inside than it says on the pump.
Thanks so much. I did a search on Yahoo and the articles that came up were all old and set the Big Oil companies profit at 65% but it looks like maybe that is actually the crude profit. Thanks again.
Whoever owns the actual oil is the winner. Without going into the weeds, the tax on fuel is mostly per gallon sold. The Southland Corporation (7-11) went into the fuel business claiming they could get by on a nickel per gallon margin on retail sales. They went broke, but not before killing the retail fuel business. The refinery makes a certain amount of money. There are transportation costs. I’ve never seen an oil contract, so I don’t know if the mineral rights holder is on a sliding scale or not. They may just get a set price per barrel. Get a bunch of neighbors together and start a cooperative. Then, hire an exploration team; buy mineral rights; hire a drilling team; build pipelines; build a refinery; build more pipelines; build a wholesale fuel distribution point; buy a fleet of transport trucks; build stations; fight with the government, property owners and environmentalists about everything, and there you have it.
Try searching Finance.Yahoo.Com for ticker symbol XOM for example. You will find that they are nearly always in the 0-10% profit range and usually around 7-8%.
One of the big problems is the EPA mandated boutique gasolines that kick in every spring. This is described in the media as “Summer Driving Season” which is a misnomer. It’s not that people drive more in the summer (or not much). It’s that due to EPA regulations, instead of a couple of types of gasoline there are now more like 100 depending on your region. This produces artificial shortages, due to the havoc it wreaks on the refineries and the pipelines.
What would be very interesting (I’ll ping thackney to this thread) would be a multi-year graph of the spread between crude and gasoline on a month to month basis. My bet is that this spread typically enlarges in the spring and summer months due to what I’m describing. This is almost NEVER mentioned in the MSM I guess cause they don’t want you to know.
You can’t fully analyze this over a period of just a few weeks. Gas prices go up and down. Oil prices go up and down. They don’t always do exactly what you might predict. You’ve got to look at it over a period of years. One of the reasons oil companies are making a lot of money right now is that during the 90’s, they took a bath, losing hundreds of billions of dollars, and a lot of them went out of business. The current high profit environment is the result of their competition going out of business, and it to some degree makes up for the bath they took in the 90’s. So yes, they are making a lot of money, and that is good. It means that in the long run, they can stay in business, and we can continue to have gasoline.
Whether 18.4 cents or, as another poster wrote, 42 cents per gallon, it is still a windfall profit for the government compared to what the oil companies get from doing the actual R&D, drilling, and refining.
It’s been mentioned here that in IL there are sales taxes on gas.
mentions there are 7 states that charge a sales tax. You likely have not noticed this because the sales tax is included in the price per gallon at the pump.
Ive never seen an oil contract, so I dont know if the mineral rights holder is on a sliding scale or not.
The contracts I’ve seen provide for the mineral rights owner to get a percent of the crude production output (1/8th, 1/6th, 1/4th, etc). The net return in dollars to the mineral rights holder would slide up/down I guess based upon what the crude market is at that time.
In 2010, Exxonmobile made just over 2 cents/gallon in profit on all fuel sales in America. The fed gov takes 18.4 cents/gallon for gas and 24.4 cents/gallon for diesel. It also taxes jet fuel. The states add to that. The average fuel tax per gallon is 48.1 cents for gasoline. More for diesel. Less for jet fuel. So, who's really screwing us?
Or there's this:
http://www.taxadmin.org/fta/rate/mf.pdf that breaks down state fuel tax rates.
Here's another site for fuel taxes by state: http://www.commonsensejunction.com/notes/gas-tax-rate.html
Here's a good pdf file that breaks down fuel taxes, other state taxes, and the combined rate of state and fed by state. http://www.easy-tax-information.com/support-files/gasoline-taxes-by-state-january-2011.pdf
Again, this is with the reminder that ExxonMobile made just over 2 cents/gallon profit on fuel last year.
You are not wrong. Most are. Every state charges an excise tax per gallon, that rate is a fixed rate, regardless of prices. However, 30 some-odd states also attach other fees, some may be fixed, but many are variable, based on the cost of fuel (sales/use taxes). See my post 35, last link, for that breakdown.
You would be surprised at all of the taxes levied before it gets to where it’s going.
Figures do not lie, but the people that use them do.
There are two types of taxes that you see at the pump. Sales tax (if your state has it) and a per gallon tax.
In California, there is 18 cents per gallon plus a 6 percent sales tax. In addition, there is an 18.4 cent federal tax.
California residents pay roughly 36.4 cents per gallon, plus another 25.5 cents per gallon sales tax (at sale price of $4.25 per gallon) for a total per gallon tax of about 62 cents per gallon.
On a typical 16 gallon fill-up costing $68.00, $9.92 is tax paid at the pump.
It’s all part of the 0bama/Soros plan!!
Whatever you do, remember this.. Oil companies are only in it for humanitarian reasons and never want more profits.
The oil/gas market is entirely a free market and is never manipulated by aramco and the producers.
If you truly believe the above you’ll go far on the FR “gas prices are only government results” mentality. You have to believe and clap your hands really hard.
The service stations always charge what it will take to refill their tanks...the gas in their tanks may have been lower but to refill them will cost them more... thats where the up price comes from...
Meanwhile the wolesale price is didctated by the COGs paid at the well head. which does not change as quickly as the specualtors actions.
Actually, in California, the state sales tax on gas is 2.25%.
The excise tax per gallon went up 17.3 cents and the sales tax went down July 1, 2010.
Per the State Board of Equalization:
3. How does the Gas Tax Swap apply to motor vehicle fuel?
Beginning July 1, 2010, the retail sale of motor vehicle fuel is partially exempt from sales and use tax. The partial exemption applies to 6 percent of the current state sales and use tax rate. Therefore, retail sales on or after July 1, 2010 are subject to sales and use tax at a rate of 2.25 percent plus applicable district taxes.
Additionally, beginning July 1, 2010, the state excise motor vehicle fuel tax goes up by 17.3 cents ($0.173) per gallon. As of July 1, 2010, the new state excise motor vehicle fuel tax rate is 35.3 cents ($0.353) per gallon.
Visuals are effective:
And what is the total amount of tax per gallon paid at the pump?
Also, how do you feel about congestion pricing? That will certainly had to the cost of motoring where it will be applied.
Nonsense. The EPA has just as many requirements in winter fuels as well. The difference is a lower vapor pressure requirement in the spring. (The actual nonsense is by the EPA, all year long).
My bet is that this spread typically enlarges in the spring and summer months due to what Im describing.
I don't have a graph handy at the moment but what I've seen in the past is is not related to seasons. I have seen a trend when oil price first gets high the margin's tend to get squeezed small until the price begins to equalise. On a percentage, a small term spike in oil will not directly relate to gasoline price spike. It will go up but not as much.
See July 2008 as an example:
I respect your opinion and experience.
Yet, empirically, most but not all, years we see prices *do* spike up in the “summer driving season” only to go back down around labor day.
This makes sense superficially - mom and dad are loading the kids in the station wagon to go off and see the Grand Canyon or Wally World - hence demands goes up - hence prices rise.
Except in the grand scheme of things it always seemed to me that that would require a hell of a lot of station wagons loaded down with kids headed for Wally World to make a dent in the overall gasoline market.
The Wall Street Journal has often editorialized on the EPA mandated boutique fuel requirements so I put two and two together and theorized that the “Summer Driving Season” was in reality the “EPA mandated boutique fuel artificially induced shortage Gasoline Price Rise Season”. Not true in your view?
I also thought that the situation was that when you move to the lower vapor pressure requirement in the springtime that’s what translates into the number of *different* fuels required which is in essence the real problem. That in the winter time the vapor pressure requirements get relaxed which in turn translates into far fewer *different* fuels needed to meet all the EPA mandates which introduces huge economies of scale that go missing in the springtime. Not true?