Role in energy policy

Taxes on transporation fuels have been advocated as a way to reduce pollution and global warming, conserve energy, and for certain countries reduce dependence on imported oil for foreign policy reasons. Placing high taxes on fossil fuels makes alternative (and often less polluting) fuels such as biodiesel or electric batteries more attractive, and put price pressure on manufacturers and consumers to choose more fuel-efficient products and processes.

Critics argue transportation fuel taxes are a regressive tax, because low-income people pay a higher proportion with respect to their income, and transportation (to work, school, etc.) is not always an avoidable expense.