Cars, unlike horses, needed good roads, paved roads, most of which were yet to be built when the automobile began to be widely adopted. In Oregon, a discussion in the legislature about the funding of these roads led to its senator, Loyal Graham, proposing the burden should lay with the users, i.e. the motorists. And the best way to do that, Graham proposed, was with a gasoline tax.

On this day, February 25, 1919, Oregon passed a law levying the nation’s first gasoline tax – 1 cent per gallon, which cost 25 cents that year. Today’s equivalent would be about a 12 cent tax on 3 dollar per gallon gas.

Oregon used the tax money to finance construction of the Pacific Coast Highway, among other projects. Seeing the state’s success, others soon followed with taxes of their own. Colorado, New Mexico and North Dakota followed that same year. Ten more states joined in 1921, and twenty in 1923. By the end of the decade all 48 states, minus the future Alaska and Hawaii, had gasoline taxes.