Desoto County NewsMississippi NewsNational News

Gas pump increases, grocery bill decreases come July 1

March 30, 2025-There might be a run on DeSoto County and Mississippi gasoline stations on June 30 ahead of an immediate three-cent-a-gallon jump on gas prices when July 1 comes around.  

At the same time, grocery shopping lists might be placed on hold until July 1 when state grocery taxes fall from seven percent to five percent.  

Those are two of the immediate possibilities come July 1 when House Bill 1 takes effect following the bill’s signing by Gov. Tate Reeves, a bill that also begins the incremental elimination of the state income tax.

​Mississippi’s gas tax is set to increase over the next three years, marking the first rise since 1987. The current tax of 18 cents per gallon will increase by three cents a gallon each year, reaching 27 cents per gallon by July 1, 2027. ​

The schedule for the gas tax increases is as follows:​

  • July 1, 2025: Increases to 21 cents per gallon (a 3-cent increase).
  • July 1, 2026: Increases to 24 cents per gallon (an additional 3-cent increase).​
  • July 1, 2027: Increases to 27 cents per gallon (a final 3-cent increase).​

Starting July 1, 2029, the gas tax will be adjusted every other year based on the U.S. Federal Highway Administration’s National Highway Construction Cost Index, with increases capped at one cent per gallon per adjustment. ​

Of note, the current 18 cent a gallon state gas tax is among the lowest in the United States as the national average is 31 cents a gallon.

Neighboring states:

  • Louisiana: $0.20 per gallon
  • Alabama: $0.28 per gallon
  • Tennessee: $0.26 per gallon
  • Arkansas: $0.24.5 per gallon

The highest gas tax is in California at $0.68 per gallon, the lowest gas tax is in Alaska at $0.089 per gallon.

As of March 27, Mississippi’s average unleaded price of $2.68 a gallon is the lowest average price in the United States.  Oklahoma is next at $2.72 a gallon and Louisiana comes in third at $2.75 a gallon, according to figures from the American Automobile Association.  

By contrast, California is where the most expensive unleaded pump price is located at $4.66 a gallon.  

AAA reports the national average price for a gallon of regular gasoline has risen to $3.15, marking a 3-cent increase from the previous week. This uptick aligns with the typical seasonal trend of rising gas prices during the spring and summer months.

Despite this increase, the current average remains approximately 40 cents lower than the same period last year, attributed to subdued gasoline demand and weak crude oil prices.

AAA puts Southaven and Olive Branch together for a “metro” view of prices in DeSoto County and the average pump price in Southaven-Olive Branch is $2.677 a gallon.  

The gas price monitoring website GasBuddy listed the top 10 gas stations and cheap gas prices in DeSoto County, giving two stations in western DeSoto County the honor of having the lowest prices at $2.48 a gallon. They are Hwy 301 Grocery in Walls and Donnie’s Deli in Horn Lake, as of Sunday afternoon.  The Walmart station on Goodman Road West in Horn Lake is next at $2.49 a gallon. 

DeSoto County’s lowest gas prices are found on the Gasbuddy.com website

Starting July 1, the additional revenue from the gas tax is intended to address the increasing costs of building and maintaining roads and bridges in Mississippi. MDOT Executive Director Brad White recently noted that while funding has remained consistent, rising costs have resulted in fewer paving projects.

While gas prices will go up on July 1, the grocery bill will drop some with the two-percent reduction in the state grocery tax to five percent.  

There could be some significance in the state to that since, according to a recent study by the personal finance website WalletHub, Mississippians spend the highest percentage of their income on groceries.  

WalletHub analyzed the prices of 26 common grocery items in each of the 50 states, then added these costs together and compared them to the median household income in order to determine where people are spending the greatest percentage of their income on groceries.

The results of the study has Mississippi grocery shoppers spending an average of $116.63, or an average cost of 2.6 percent of the median household income, That is the highest percentage in the country. For comparison, New Jersey residents only spend around 1.5 percent of their income on groceries, the lowest percentage.

Interestingly, grocery prices in Mississippi are actually relatively low – the ninth-cheapest in the nation. For example, in 15 of the product categories measured in the WalletHub study, including chunk tuna, margarine, peas, dishwashing detergent, and peaches, Mississippi is among the 10 least expensive states.

The main problem lies in the fact that Mississippi has the lowest median annual household income in America, at just $52,985. So even with relatively low grocery prices overall, Mississippians are spending a higher percentage of their income on groceries than people in any other state.

Gas pump prices and grocery bills will be the two most immediate indicators of what will happen with the signing of House Bill 1 in the 2025 state legislative session.