Tax Relief

gov. Newsom Proposes Tax Reduction to Assist Californians Pay Rising Fuel Costs

An aircraft flies over a sign displaying current gas prices as it approaches to land in San Diego on Feb. 28, 2022. REUTERS/Mike Blake

gov. Gavin Newsom on Tuesday proposed giving Californians tax relief to offset the rising cost of gasoline resulting from Russia’s invasion of Ukraine.

Newsom mentioned the idea briefly during his State of the State speech at the Capitol, but provided no specifics.

“No one’s naive about the moment we’re living in, with high gas prices and the geopolitical uncertainty fueling them,” he said. “That’s why — working with legislative leadership — I’ll be submitting a proposal to put money back in the pockets of Californians, to address rising gas prices.”

He said this would be in addition to a pause in the gas tax increase that he proposed in January.

New tonight —

I’ll be working with legislative leaders on a proposal to put money back in Californians’ pockets to help with rising gas prices.

Let’s make it happen.

— Gavin Newsom (@GavinNewsom) March 9, 2022

Senate President pro Tem Toni Atkins from San Diego and Assembly Speaker Anthony Rendon promised that lawmakers would move quickly

“The Legislature will put the state’s robust revenue growth to work by returning substantial tax relief to families and small businesses as fast as possible,” they said in a joint statement.

The two suggested that the state’s general fund could be the source, explaining, “This can avoid taking critical funds away from road repair and improvement, while fully protecting Proposition 98 funding for schools.”

Republican state Sen. Patricia Bates, who represents parts of north coastal San Diego County, suggested that Newsom temporarily suspend the gas tax to save 50 cents per gallon.

The average price of a gallon of self-serve regular gasoline in San Diego County rose 10 cents Tuesday, to $5,483 — its 19th record high in the past 21 days.

In Wednesday morning trading in Asia, the price of US benchmark West Texas Intermediate crude oil was up 1.4% to $125.45 per barrel amid growing sanctions against Russia. The price was under $70 a barrel as recently as early December.


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