Govt. gasbags silent on gas tax boon

Nov. 1, 2012

By Katy Grimes

While nearly every politician in America publicly decries the high cost of gasoline and fuel costs, most are also strangely silent about the soaring gas tax revenues that states are currently enjoying.

Californians always seem to pay the highest gas prices in the country. On top of record fuel prices, the state should be reporting how enriched it is by record gas tax collections.

Yet even with this record gas tax collection, Gov. Jerry Brown and state Democrats continue to claim that the state doesn’t have enough money and needs even more tax increases.

Having and eating your cake

Californians paid $8.3 billion to the state government in gas taxes last year. That’s the bad news.

The worse news is that the Tax Foundation just came out with a new report finding that Californians are not only overtaxed, we shoulder one of the highest tax burdens in the country. Should Brown’s Proposition 30 pass, increasing sales and income taxes, we easily slide into the number one spot for the highest taxed state in the nation.

“At a time when Californians could least afford it, our state and local tax burden was among the highest in the nation,” said former state Sen. George Runner, now an elected member of the state Board of Equalization. “This new report provides further proof that by every measure Californians are overtaxed.”

The Board of Equalization administers the motor vehicle fuel tax, diesel tax and 32 other tax and fee programs.

Adding to Californians’ overall tax burden, “Our latest numbers show that high gas prices resulted in a record windfall for government at the expense of California consumers,” Runner said. “It’s bad enough that California’s gas tax is among the highest in the nation. It’s even worse that gas taxes goes up whenever gas prices rise.”

California’s high taxes

California’s 2009 state and local tax burden of 11.8 percent of income is well above the national average of 9.8 percent. California’s top individual income tax rate is 10.3 percent. The corporate tax rate is an 8.84 percent flat rate. The state sales tax is 7.25 percent, with many counties adding onto that rate. And California collected $1,465 per capita in state and local property taxes in fiscal year 2009, according to the Tax Foundation.

The once-Golden State of opportunity and innovation now ranks 48th in the Tax Foundation’s State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property.

Gas tax for gasbags

From July 1, 2011 through June 30, 2012, the Board of Equalization reported that it collected $6.9 billion in motor vehicle fuel taxes, up from $6.7 billion the prior year. Excise tax revenues accounted for $5.2 billion, while sales tax revenues accounted for $1.7 billion, Runner explained.

Over the same time period, the state collected $1.4 billion in diesel fuel taxes, up from $1.2 billion the prior year. Excise tax revenues accounted for $343 million, while sales tax revenues accounted for $1.1 billion.

California’s gasoline tax is 68.8 cents on every gallon of gasoline, and 77.1 cents on every gallon of diesel fuel, according to the American Petroleum Institute.

“What’s particularly concerning about these numbers is that they would have been even higher had the governor been successful in extending the higher sales tax,” said Runner.

Runner said that had Gov. Arnold Schwarzenegger’s 1 percent temporary sales tax increase from 2009 not expired on July 1, 2011, Californians would have paid an additional $96 million in diesel taxes last fiscal year.

Runner also explained that California’s 2010 fuel tax swap law would have required a larger motor vehicle fuel excise tax rate increase, costing Californians more than half a billion dollars extra in the 2012-13 fiscal year.

According to the BOE, these taxes and fees include:

* A federal excise tax of 18.4 cents per gallon;

* A state excise tax of 36.0 cents per gallon, up from 35.7 cents effective July 1;

* A sales tax averaging 3.12 percent when local taxes are included.

Runner said that it is important to note that the sales tax is calculated on the total price of the fuel sale including excise taxes, resulting in double taxation.

The breakdown for diesel is similar:

* The federal excise tax is 24.4 cents per gallon;

* The state excise tax is 10 cents per gallon, down from 13 cents effective July 1;

* The sales tax is 9.42 percent, up from 9.12 percent, plus applicable local taxes.

Race to the top tax bracket

“This is a race to the top, not in education, but in taxing. It shouldn’t take a genius to see how other states are doing it,” Runner said. “California’s economy is now full of man-made obstacles; that’s what caused the absolute devastation of this economic machine.”



Write a comment
  1. Rex the Wonder Dog!
    Rex the Wonder Dog! 1 November, 2012, 17:58

    I think Teddy and seesaw qualify as gov gasbags too 😉

    Reply this comment
  2. us citizen
    us citizen 1 November, 2012, 18:06

    LOL oooops did that come out of my mouth…….

    Reply this comment
  3. Hondo
    Hondo 1 November, 2012, 18:09

    All these taxes and Kalifornia isn’t within miles of balancing their budget. “How do those other states do it?” Jerry Clown grumbles. He can’t figure out how they can run their states with so little taxes.

    Reply this comment
  4. Rex the Wonder Dog!
    Rex the Wonder Dog! 1 November, 2012, 20:47

    “How do those other states do it?” Jerry Clown grumbles. He can’t figure out how they can run their states with so little taxes.
    They dont comp their employees $175K/year on average, that’s how!

    Reply this comment
  5. Ulysses Uhaul
    Ulysses Uhaul 1 November, 2012, 23:09

    Will someone tell the posting oinker to go on vacation…..a long one.

    Reply this comment
  6. Rex the Wonder Dog!
    Rex the Wonder Dog! 1 November, 2012, 23:19

    Hi Teddy 😉

    Reply this comment
  7. Donkey
    Donkey 2 November, 2012, 05:19

    Katy, great story! I have been telling friends for the last four years, “Where is the concern for the taxpayer over the extra taxes being paid at the pump and why are Californians paying a dollar more than the rest of the nation.”

    There is no reason for the drivers in our state having to pay a dollar higher than the rest of the nation other than the generation of tax dollars for the RAGWUS feeders crooked favor. Notice no heartache from the greedy feeders governing in Sactown on the gas burden placed upon the private sector workers. 🙂

    Reply this comment
  8. Ulysses Uhaul
    Ulysses Uhaul 2 November, 2012, 10:13

    You will pay to breathe in 2013….get over it…we are broke….we need your money!

    Reply this comment
  9. SeeSaw
    SeeSaw 2 November, 2012, 19:40

    Donkey, the gas tax burden is no different for private sector workers, than it is for public sector workers.

    Reply this comment
  10. Rex the Wonder Dog!
    Rex the Wonder Dog! 3 November, 2012, 00:54

    Public workers are subsidized by private workers seesaw, big difference.

    Reply this comment
  11. SeeSaw
    SeeSaw 3 November, 2012, 09:54

    Really, Rex? Is that why so many private businesses in Sacramento had to close, when the Governor forced the fourloughs on his State work force–because they didn’t have enough money left to subsidize those employees when those employees were home on Fridays, instead of having lunch in their establishments?

    Reply this comment
  12. Omri
    Omri 3 November, 2012, 18:11


    When those “soaring” gas tax revenues “soar” enough to cover the cost of maintaining the roads, wake me up. Until then. you’re yapping about nothing.

    Reply this comment
  13. Ulysses Uhaul
    Ulysses Uhaul 3 November, 2012, 19:45

    Poodle yaps at the moon!

    Reply this comment

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