Sacramento, California – Starting July 1st, California’s excise gas tax will increase by 1.6 cents per gallon, bringing the new rate to 61.2 cents per gallon, up from the previous rate of 59.6 cents.
This adjustment is part of the state’s standard practice to track inflation based on the California Consumer Price Index, as reported by the California Department of Tax and Fee Administration.
Why the Increase?
The increased excise tax is a response to recent claims about gas price hikes in the state. Governor Gavin Newsom’s office said this increase is aimed at countering “disingenuous claims” regarding gas price surges in California.
This tax increase will most likely be passed on to consumers, potentially making fuel even more expensive for drivers.
What Is the Low Carbon Fuel Standard?
In addition to the gas tax hike, the Low Carbon Fuel Standard (LCFS) will see changes as well. The LCFS is a program aimed at reducing pollution and lowering greenhouse gas emissions by encouraging cleaner fuels.
Starting July 1st, the regulation will impose stricter targets for fuel carbon content and expand the $2 billion credit market designed to incentivize the use of cleaner energy sources.
Newsom’s office has responded to claims that these changes will increase gas prices by as much as 65 cents per gallon, stating that such projections are false.
According to their official statement, a more reasonable estimate of the impact on prices is an increase of 5 to 8 cents per gallon, which was noted in a San Francisco Chronicle article quoting Colin Murphy from UC Davis.
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Gas Prices Today
As of June 30th, the average price of gas in California is $4.59 per gallon, according to AAA Fuel Prices. While this is a slight decrease from last week’s average of $4.66, it still remains about $1.40 higher than the national average for the same day.
Impact of These Changes
These adjustments are part of a larger effort to reduce emissions and promote cleaner transportation fuels, but they have raised concerns about the financial impact on residents already dealing with high gas prices.
Some argue these changes are necessary for long-term environmental goals, while others fear they could create additional burdens for California residents.
What are your thoughts on the gas tax increase in California? Do you think it will have a significant impact on your budget? Share your thoughts in the comments below!
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