Gas Tax to Increase for Calif.

Gas tax will go up by 3.5 cents

By Paul Krueger and Sarah Grieco
|  Thursday, Feb 28, 2013  |  Updated 5:55 PM PDT
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Gas Tax to Increase for Calif.

Getty Images/OJO Images

A state agency today increased the gas tax by more than three cents a gallon.

Starting July first, almost 40 cents of the cost of every gallon of gas purchased in California will go toward programs that help build highways and pay for mass transit.

Californians actually bought less gasoline last year partially because motorists were driving more fuel-efficient cars and trucks. Also, high prices have discouraged consumption.

But there's a downside to conserving fuel.

The less gas purchased, the less tax money flows to the state treasury. So to keep revenues steady, the State Board of Equalization approved a 3.5 cent increase in the excise tax -- from 36, to 39.5 cents per gallon.

Two of the Board's five publicly-elected members opposed the increase – so the increased passed by a single vote.

The hike takes effect in July. If you drive 15,000 miles a year, at twenty miles a gallon, you'll pay $26 a year more for gas.

The other taxes paid on gas, including federal and state sales tax, are not changing.

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