State gas tax set to go up on July 1

Mississippi’s average gasoline price for unleaded regular gas is the lowest of any state in the nation. However, pump prices in the state are about to go up with the start of the month of July. That’s because the state gas tax is set to rise three cents a gallon as part of legislation aimed at also lowering the grocery tax and phasing out the state income tax.  

House Bill 1, passed in the 2025 legislative session, puts an increase in the gas tax in motion in phases over the next three years. The measure, passed by Gov. Tate Reeves will raise the tax to 21 cents a gallon on July 1, 24 cents a gallon on July 1, 2026, and 27 cents a gallon on July 1, 2027.  

State Reps. Justin Keen (R-Byhalia) and Dan Eubanks (R-Walls) were among the sponsors of the bill.

The tax rate will be adjusted for inflation in 2029.

This is the first gas tax increase in Mississippi since 1987.  Alaska has the lowest tax rate in the country at 8.95 percent, followed by Mississippi at 18 cents. Hawaii at 18.5 cents per gallon is the third-lowest in the USA.  

As of Monday, the nation’s average gas price was $3.14 a gallon, while in Mississippi, the average price for unleaded regular was $2.66, followed by Tennessee at $2.709. DeSoto County’s average was $2.627 a gallon.