California’s gas tax climbed to 50.5 cents a gallon as another increase went into effect on Wednesday.
The state’s excise tax rose 3.2 cents per gallon, bringing the total to 50.5 cents. Including federal and other taxes, California motorists are paying 79 cents in taxes per gallon at the pump — the highest in the nation, according to the American Petroleum Institute.
After the latest spike, California’s gas tax is double the national average of 25 cents, API reported.
The state’s excise tax has been steadily rising almost every year thanks to Senate Bill 1, which was signed into law by then-Gov. Jerry Brown in April 2017.
It increased 12 cents on Nov. 1, 2017, and then another 5.6 cents on July 1, 2019.
The taxes and fees are expected to raise more than $5 billion in revenue annually to help pay for transportation costs such as road maintenance and repairs.
In addition, SB 1 imposes a $100 vehicle registration fee on zero-emissions vehicles starting Wednesday.
Four other states — Illinois, Nebraska, South Carolina and Virginia — also enacted an increase on state gas taxes on July 1, according to fuel pricing website GasBuddy.com.
“Increasing gas taxes is not uncommon. What makes this year different is what the coronavirus has done to the economy,” a blog post on GasBuddy.com read. “Many are questioning the timing of these increases given that millions of people have lost their jobs. This especially rings true in California, the state with the highest gas taxes causing the Golden State to be the priciest place to fill up.”
While California typically has the most expensive gasoline in the country, that dubious distinction now goes to Hawaii, which — as of Wednesday — had an average of $3.21 a gallon, according to AAA. The Golden State’s gas prices were the second highest in the country, at an average of $3.07.
Even with the new tax tacked on, prices at the pump are still well below what they were one year ago, when a gallon of regular unleaded averaged $3.75.
That’s true across the country ahead of the Fourth of July weekend, which will see the cheapest gas prices across since 2004.
“While gasoline demand has continued to rebound, there is anxiety about the recent surge in new coronavirus cases in the U.S., and that could prevent gas prices from seeing a continued rebound. However, we’re currently in the midst of the lowest summer gas prices we’ve seen in some 15 years,” Patrick De Haan, the head of petroleum analysis at GasBuddy.com., said in a blog post.
Still, gasoline costs overall have started to climb again after prices plummeted across the U.S. due to declining demand that began as states instituted stay-at-home orders in March to deal with the burgeoning COVID-19 pandemic.
By early May, California’s average hit $2.74 before prices began a steady climb again.
