by Katy Grimes, E&E Legal Senior Media Fellow and California Globe Editor
As Appearing in the California Globe
Any increase in the gas tax is a surefire way to put the California economy on the road to ruin’
California gasoline already costs approximately $1.50 above the national average, and we are getting another gas tax hike next week.
The gas tax increase coming July 1st that CalTax explained in our previous article is the gasoline excise tax, as opposed to the low-carbon fuel standard tax changes. The amounts are very similar, which has caused confusion.
An excise tax is a specific type of tax levied on certain goods or services at the time of their purchase including gas, tobacco, and airline tickets, imposed by local, state, and federal government.
The California Air Resources Board voted in November to approve new gas regulations (taxes) which will result in as much as a 65 cent per gallon increase in California’s gas prices. The vote made significant updates to the low carbon fuel standard (LCFS), which requires the state to reduce the environmental impact of gas and other transportation fuels by incentivizing producers to cut emissions.
The excise tax — the per-gallon tax that was increased substantially by the Legislature several years ago, with a provision that requires the CDTFA, the California Department of Tax and Fee Administration to adjust the rate annually for inflation — is increasing from the current 59.6 cents per gallon to 61.2 cents per gallon, starting July 1. The CDTFA, which is part of the governor’s administration, is required to increase the gas and diesel excise tax rates every year, effective July 1.
