Gas tax increase: How much will prices increase?

California

SACRAMENTO, Calif. (KTXL) – The cost of gas across California will take a big jump beginning Thursday due to a new gas tax going into effect.

Drivers in Sacramento are already feeling the pinch in their bank accounts even before the expected price hike.

“They’ve skyrocketed in the last year. In the last 6 months, even. It’s gotten so crazy,” Sacramento resident Eric Dickinson told FOX40. “At the beginning of the pandemic, it was so low, almost down to $2. So, it’s more than doubled in the last year. It’s just completely crazy. How much more expensive can it get?”

Because of an annual inflation adjustment from Senate Bill 1 that was passed in 2017, drivers can expect to see another 2.25% per gallon tax increase for regular gas starting Thursday.

The initial increase from the bill was 12 cents per gallon. Since then, there has been an annual 2.25% increase.

Former state Sen. Jim Beall, who introduced the bill, says the last time California had a gas tax increase was in the early nineties.

 “The $0.12 equals the amount of what would have been in response to inflation since the 1990s,” Beall explained.

Beall says the state currently has a backlog of road repairs and the extra revenue from the tax is much needed.

“We’re repairing the roads with the money and we have performance requirements that make sure the money is for road repairs,” Beall said.

But John Coupal with the Howard Jarvis Taxpayers Association says the gas tax is a direct hit on the middle class.

“We could only hope that it’s actually used for roads, highways, and bridges, but the reality is that so much of it is diverted,” Coupal said. “So much of it is diverted to other kinds of transportation projects.”

Regular gas at a downtown Sacramento gas station cost drivers $4.29 per gallon, while just around the corner, another gas station is charging drivers $4.19.

While Dickinson agrees the roads need work, he says he can’t help but feel it in his wallet.

“I mean nowhere is cheap anymore, so where do you go?” Dickinson asked.

The tax will generate $5.4 million for the state.

If all the money is spent as intended, Beall says it would take the state 10 years to clear the backlog of road repairs.

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