Californians are paying the highest gas prices in the nation, which are continuing to rise due to many taxes and fees that most residents are not aware they are even paying.
According to Irvine-based research firm Stillwater Associates, Californians pay at least $1.19 per gallon in taxes and fees alone. This can fluctuate by a few cents, depending on sales tax.
These taxes and fees cause motorists to pay a whopping $762.3 million per year in added costs due to the state consuming 15.4 billion gallons of gasoline a year.
Even after the state’s gas prices have risen to record levels in 2021, experts believe that they will only continue to grow given the state’s commitment to move to 100% carbon-free sources of power by 2045.
The taxes include an 18 cent per gallon federal government excise tax, a 50.5 cent per gallon California excise tax which includes a 12.7 cent tax from Senate Bill 1, and a state sales tax of approximately 10.7 cents per gallon.
While that 70.9 cents per gallon tax makes up the majority of the fees, there are still many fees that most Californians are unaware of. They include a 2 cents per gallon underground tank storage fee, a “Fuels Under the Cap” fee which requires suppliers to purchase allowances to offset emissions costing 14.3 cents per gallon, and the Low Carbon Fuel Standard, which requires high carbon fuel suppliers to purchase credits from low carbon fuel suppliers, costing consumers 22.6 cents per gallon.
Leigh Noda, a senior associate at Stillwater Associates, told the San Diego Union Tribune she thinks people would be surprised by a quick Google search on California gas taxes. She says there are hidden taxes people would not easily find.
“When you do a Google search for taxes and fees (on gasoline), excise taxes and sales taxes and things like that show up,” Noda added, “What doesn’t show up is the way that climate change fees are levied along the supply chain for fuels.”