An Excise Tax Paid Mainly by ConsumersThe relatively steep demand curve here reflects a low price elasticity of demand for gasoline. The relatively flat supply curve reflects a high price elasticity of supply. The pre-tax price of a gallon of gasoline is $2.00, and a tax of $1.00 per gallon is imposed. The price paid by consumers rises by $0.95 to $2.95, reflecting the fact that most of the burden of the tax falls on consumers. Only a small portion of the tax is borne by producers: the price they receive falls by only $0.05 to $1.95.