Voters in California will decide this November whether to repeal at least one recent tax increase in the state: a gas tax hike passed in 2017.
The state GOP has officially earned the initiative a spot on the ballot, after a petition generated more than the required number of signatures. The petition also raised more than $2 million, with significant contributions from major Republican members of Congress, including House Majority Leader Kevin McCarthy, who donated at least $200,000 to the campaign as midterm elections approach.
The Republican-led measure to repeal the tax increase would also prevent the state legislature from implementing any future gas or car tax increases without voter approval.
On Nov. 1, California not only raised its base gas tax by 12 cents to 30 cents per gallon, but it also increased the diesel fuel excise tax by 20 cents to 36 cents per gallon, lifted the sales tax on diesel from 5.75% to 9.75% and added a range of new vehicle fees. Drivers of cars valued under $5,000, for example, owe $25 per year, while those with vehicles valued over $60,000 can owe as much as $175. Starting in 2020, drivers of electric vehicles will pay a yearly $100 fee instead of the gas tax.
The policy, championed by the state’s Democratic Gov. Jerry Brown, is expected to raise more than $5 billion each year, money that will be put toward infrastructure repair and modernization.
As it stands, California drivers are already hammered by any increase in fuel prices, due in part to the elevated state taxes. Oil prices are also on the rise.
As of Tuesday, the average retail price of gasoline in the Golden State was $3.67 per gallon, well above the national average of $2.84, according to AAA.
Earlier this year, the Trump administration floated an increase in the federal gas tax to help fund the proposed $1.5 trillion infrastructure revamp. The federal fuel tax has not been raised since 1993. The current rate is set at 18.4 cents per gallon and has not kept pace with inflation. Drivers in California were expected to be among the most dramatically impacted by one proposal Trump was reportedly considering: a one-time 25-cent increase.
However, the White House later hinted it may instead favor a tax on mileage, known as a vehicle miles traveled tax, or VMT, which would impose charges based on the amount of miles driven on state roads.