Gov. Gavin Newsom
By MADISON HIRNEISEN
THE CENTER SQUARE STAFF REPORTER
(The Center Square) — As California’s gas prices continue to skyrocket to record-breaking levels, Gov. Gavin Newsom and lawmakers are vowing to bring consumers relief at the pump through tax rebates.
California’s average price for a gallon of gas reached a record-high of $5.57 Wednesday, shattering the previous day’s record by 13 cents, according to the American Automobile Association. Nationwide, the average price for a gallon of gas reached $4.25 Wednesday.
With residents feeling the impact of rising gas prices on their wallets, Gov. Newsom announced during his State of the State Address on Tuesday that he plans to introduce a proposal to “put money back into the pockets of Californians.”
While the governor did not elaborate on details during his address, a spokesperson for the Governor’s Office told The Center Square in an email that the relief will come in the form of a tax rebate.
“We are looking to move quickly on this,” the spokesperson said. “The governor is focused on providing billions in relief to Californians who are suffering from rising gas prices across the country due to the ongoing situation in Russia.”
In response to Gov. Newsom’s announcement, Senate President pro Tempore Toni Atkins and Assembly Speaker Anthony Rendon said in a joint statement Tuesday that the State Legislature will work to provide “substantial relief” to families by tapping into the state’s General Fund to deliver tax rebates.
“Californians are rightfully upset at the skyrocketing cost of fuel,” Sen. Atkins and Assemblyman Rendon said. “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.”
Sen. Atkins and Assemblyman Rendon noted that using General Fund money would provide greater relief than a modest slash to the gas tax — referring to a measure Gov. Newsom floated in his budget proposal that would pause the annual increase to the fuel excise tax. According to the Legislative Analyst’s Office, the governor’s proposal would prevent about a 3 cent per gallon increase at the pumps.
“Gas, food and other prices are up, so our focus cannot be a small cut to the gas tax that might not get passed on to consumers,” the lawmakers said.
As Democratic legislators are pushing back on Gov. Newsom’s proposal to pause the annual excise tax increase, several Republican lawmakers are calling for the Legislature to outright eliminate the gas tax.
Assemblyman Kevin Kiley, R-Rocklin, introduced a bill in January to suspend the gas tax for six months, a move he says would save Californians 50 cents per gallon at the pump. Currently, the state’s excise gas tax rate per gallon stands at 51 cents. Assemblyman Kiley’s bill has not yet been assigned to a committee.
“This bill puts money back into the pockets of families at a time when they need it most,” Assemblyman Kiley said in a statement in January. “Inflation and record gas prices are making our state even less affordable. Californians need relief.”
Looking ahead, experts say it’s hard to forecast how gas prices will shift in the coming weeks.
During a typical year in Southern California, gas prices typically rise anywhere from 30 cents to 50 cents per gallon between January and May because the state uses two different types of gasoline for pollution control, according to AAA Southern California spokesperson Marie Montgomery Nordhues.
“Clearly we are already well past 50 cents. L.A. prices rose 62 cents just in the last week, which has never happened before,” Ms. Nordhues told The Center Square in an email.
Ms. Nordhues noted that California started the year at near-record levels for gas prices driven by inflation, rising oil prices and a temporary shutdown of some Northern California oil refineries due to weather impacts.
Over the last month, the conflict in Ukraine has driven up oil prices, causing gas prices to rise stateside, she added.
“This really has been an unprecedented year, so it is hard to say what will happen,” Ms. Nordhues said.
Madison Hirneisen covers California for The Center Square.
