Search Federal and State Laws and Incentives

Alternative Fuel Tax Rate

A distributor of any alternative fuel used to operate an internal combustion engine must pay a license tax of $0.0025 for each gallon of alternative fuel the distributor sells or uses. In addition, a distributor must pay a license tax for each gallon of fuel sold or used by the distributor for operating a motor vehicle on state public highways according to the following rates:

For other alternative fuels, the rate is based on the energy content of the fuels as compared to diesel fuel, using a lower heating value of 130,000 British thermal units per gallon as a standard for diesel, so that the tax rate, on an energy content basis, is equal to one-quarter the rate for diesel fuel. Counties may impose additional taxes. (Reference Hawaii Revised Statutes 243-4 and 243-5)

Alternative Fuel Vehicle (AFV) Registration

Owners of plug-in electric vehicles and AFVs must pay an annual fee of $50, in addition to standard registration fees. Fees contribute to the State Highway Fund. (Reference Senate Bill 409, 2019, and Hawaii Revised Statutes 249-31)