On Saturday, December 9, 2023, the Department of Revenue published notice in the Pennsylvania Bulletin of gasoline and diesel tax rates for 2024.

The tax rates for diesel published last year, combined with PA sales tax, made diesel taxes in Pennsylvania the highest in the nation in 2023.

In 2024, those record high tax rates will come down from $0.785 per gallon to $0.741 per gallon.

The oil company franchise tax is imposed on all taxable liquid fuels on a per-gallon basis and is paid by distributors of liquate fuels. The rate of the oil company franchise tax is determined annually by the Department of Revenue and announced by each December 15 for the following calendar year. The tax rate is determined on a “cents per gallon equivalent basis,” which is defined as the average wholesale price per gallon multiplied by the decimal equivalent of any tax imposed by PA C.S § 9502 (relating to imposition of tax).

According to 75 PA C.S. § 9002, after December 31, 2016, the average wholesale price shall be as determined by the Department of Revenue for the 12-month period ending in September prior to the year for which the rate is to be set. For the 12-month period ending September 30, 2023, the Department has determined that the average wholesale price for all grades of gasoline and diesel fuel was $2.84 per gallon, therefore, the average wholesale price for 2024 is set at the floor of $2.99 per gallon – which resets the tax rate back to the previous minimum rate in effect prior to 2023.

Despite the decline, the PA diesel tax rate remains among the highest in the nation. 

Taxes on motor gasoline are also decreasing under the same formula from $0.611 per gallon to $0.576 per gallon.

See the full notice here in the PA Bulletin here: https://www.pacodeandbulletin.gov/Display/pabull?file=/secure/pabulletin/data/vol53/53-49/1703.html