Over the last month, gas prices in San Diego County have decreased by around 25 cents; but, beginning of Monday, a new tax will marginally raise expenses.
The average cost of a gallon of petrol in San Diego as of this past weekend is $4.82. As of right now, the state excise tax adds an extra 58 cents to each gallon. However, this tax will increase to 60 cents per gallon on July 1. Customers will thus have to pay an additional quarter to fill up a 12-gallon tank.
Professor of economics in the San Diego region Joe Silverman remarked, “I don’t know what an extra two cents is going to do, but it’s probably not gonna stop there.” “We’ve kind of taken the increase in gas prices over the last couple of years from $4 to $5 per gallon pretty calmly.”
Starting on Monday, drivers will pay 90 cents in taxes per gallon of petrol, which are divided down as follows, according to statistics from the California Energy Commission:
- The state excise tax is $0.60.
- There is a federal excise duty of $0.18.
- An additional 0.10 cents for state and municipal sales taxes
- The state charges $0.02 for an underground storage tank tax.
During a press conference in March, San Diego County Supervisor Jim Desmond attempted to block the implementation of the hike by stating, “This is just way over government regulation, and now is not the time.”
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According to Desmond, the state is already excessively costly. Governor Gavin Newsom, nevertheless, accused energy firms of driving up costs.
After the second Republican presidential debate in September, Newsom said that oil firms were taking advantage of Californians in an appearance with Fox News.
Silverman casts doubt on this account. He questions whether the state’s mandate that all cars have zero emissions by 2035 is having an impact on the cost.
“If you’re the CEO of an oil company, you have to be charging more to make up for the possibility that you may not be in business anymore in California,” he added. “If this mandate for no more gasoline-powered cars goes into effect in 2035 or sometime thereafter, there won’t be a need for any gasoline because people will be transitioning.”
AAA reports that the average petrol price in neighboring Arizona is $1.23 less than that of California. However, the state excise tax paid by Arizona is just 53 cents less.
In addition to taxes, Silverman stated that several additional factors contribute to California’s high gas costs.
“We’re sort of in what we call a gasoline island, meaning that we can’t just get gasoline from Texas or another state because it’s got to be formulated to meet the different air pollution requirements of different parts of the state,” he added.
According to a state analysis issued last year, over the next ten years, revenue from gas taxes would decrease by over $6 billion. Eighty percent of highway and road maintenance is financed, according to Caltrans, by the state excise tax.
