California drivers pay the nation’s highest gasoline taxes. Now they’re going higher
California motorists will find their taxes for a gallon of gasoline — already the nation’s highest — went up Thursday because of inflation.
And that’s on top of what AAA says are the highest average per gallon gasoline prices in the country.
The average price of a gallon of regular gasoline in the state Thursday was $4.28, the group said. Sacramento’s average was $4.22, according to the GasBuddy website. Only one other state, Hawaii, has an average over $4 at $4.02
“The West Coast typically has the most expensive gas prices. Most of it comes down to taxes,” said Jeanette McGee, a AAA spokeswoman..
California motorists will now pay 51.1 cents a gallon in state tax for gasoline starting Thursday, up from 50.5 cents, thanks to an increase for inflation. That tax climbs almost every summer to account for inflation.
Republican lawmakers earlier this week put forward a proposal to suspend state gas tax collections one year, citing the state’s unprecedented $80 billion budget surplus and the financial strains on Californians returning to commutes after COVID-19 restrictions. Their proposal failed in the Democratic-led Legislature.
“Unlike the price of gas, talk is cheap in Sacramento. Democrats like to claim they help everyday Californians, but completely failed to act on a proposal that would have actually put money back in the pockets of struggling Californians,” Senate Republican Leader Scott Wilk of Santa Clarita said.
Gasoline prices are up nationally for three major reasons, said AAA.
It cited “confidence in worldwide vaccination rollout, global oil demand spikes, and the easing of travel restrictions leading to optimism for leisure travel.”
Taxes are also a reason for the California increase. Prior to Thursday, California drivers paid 81.45 cents a gallon in total taxes for gasoline, the highest such tax in the nation. Second was Pennsylvania at 77.1 cents per gallon as of January 1, according to the American Petroleum Institute.
California motorists will get this slight break: No increase in the 18.4 cents a gallon federal gasoline tax is likely anytime soon.
Tying that tax to inflation has been seriously discussed among Republican and Democratic senators seeking ways to pay for an infrastructure compromise.
They’re still struggling for ways to find $579 billion for the infrastructure deal announced last week by President Joe Biden and 10 senators.
They listed 13 broadly-worded options to pay for their plan. None involved the gas tax, as Biden said he wouldn’t accept an increase.
California roads need help
California has significant infrastructure needs. The Federal Highway Administration found that last year, of 25,763 bridges in the state, 1,536 were rated in poor condition.
Nineteen of Sacramento County’s 736 bridges were listed as poor. Other poor ratings: Fresno County, 45; Stanislaus County, 48; Tulare County, 34; Madera County, 36, Placer County,9, Yolo County, 12 and San Luis Obispo County, 24.
California’s higher motor fuel taxes were authorized in a comprehensive transportation plan, known as 2017’s Senate Bill 1.
The tax increases were designed to raise about $5.4 billion a year for highways, bridges, transit and local roads. The 0.6 cent a gallon tax increase this year is expected to bring in about an additional $83 million.
The tax is expected to bring in $7.1 billion in fiscal 2021-22, up from $6.4 billion last year.
While the program was designed to expedite repairs, it was never meant as a quick fix for all the state’s road problems.
A higher federal gas tax?
The state needs help from Washington, but it’s not likely to come in the form of a higher federal gasoline tax.
The federal gasoline tax is supposed to be used to build, repair and replace roads and bridges, though in 2019 about one-fifth of the revenue went to help public transit.
The federal infrastructure deal Biden backs includes $109 billion for road and bridge repair.
Caltrans officials aren’t commenting on any federal initiatives, as they wait to see what’s finally approved.
The compromise ideas for funding the federal infrastructure deal include extension expiring customs fees, reinstating Superfund fees for chemicals, sales from the nation’s Strategic Petroleum Reserve, and using unspent unemployment and other state and local COVID relief funds.
No precise details were offered by those involved in the deal.
This story was originally published July 1, 2021 at 11:52 AM.
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