Senator Patricia Bates (R-Laguna Niguel) has signed a letter to Governor Newsom and legislative leaders urging her to pass a “gas tax vacation” that would give Californians tax breaks if gas prices continued to rise.
A holiday would be a complete moratorium on California gas excise duties, which will be replenished with US dollars from the state’s general fund for fiscal year 2021-2022. This would ensure transportation infrastructure projects are not affected while Californians get tax breaks.
Below you will find important excerpts from the letter. Click here to view the full letter.
Californians currently have the highest gasoline prices in the country, averaging $ 4.22 for a regular gallon of gas, more than $ 1.15 above the national average, according to AARP. While this legislature is considering expanding Golden State Stimulus payments to more Californians, it’s important to understand that any move to ease the financial burden on Californians will be undermined by the accompanying increase in gasoline excise taxes. The negative impact of high gas prices and taxes, which we know to disproportionately affect our low- to middle-income residents, not only affects motorists, but also increases the cost of living, including business costs and food prices, and hinders our relief efforts and the economic recovery.
“On July 1st, California’s excise duty on a gallon of gasoline will rise to 51.1 cents. At a time when the state budget is in historic surplus, Californians deserve tax breaks, not higher taxes. The average family of four pays up to $ 800 in gasoline taxes a year, and that increase will cost California drivers an additional $ 83 million in the next year alone. Gas costs make up 14% of spending in the agricultural sector, and an increase in gas tax would naturally increase food prices, which would not only result in a higher tax at the pump, but also a higher cost at the cash register.
“A gas tax vacation, more specifically a full moratorium on California gasoline consumption tax collection, which will be topped up with generic fund dollars for fiscal 2021-2022, would provide much-needed relief for Californians.”