Ready For Your Annual Inflation-Indexed Michigan Gas Tax Hike?

Michigan motorists should be prepared to see the state gasoline and diesel fuel tax increase by about 3.3% on Jan. 1, thanks to a change in the law added by the Legislature to a tax hike imposed in 2015.

The tax rate on both gasoline and diesel fuel will increase from 26.3 cents per gallon to 27.2 cents per gallon.

The calculations used to set each year’s index are based on lagging indicators, which means if inflation persists or picks up further, tax hikes in the future could become more painful.