California gas tax repeal fight gets an unlikely player — Trump

Key Points
  • Last year, California legislators approved raising the state excise tax on gasoline by 12 cents per gallon, or a 40 percent increase.
  • A petition drive to repeal the hike is underway and backers are "on track" to get enough signatures.S
  • Some have suggested President Trump's support for a federal gas tax increase could undermine the repeal efforts in California.
  • The president proposed a 25 cent-per-gallon increase in the federal gas tax to help pay for his $1.5 trillion infrastructure plan.
Getty Images

Californians love their cars but these days they're feeling more pain at the pump due in part to increased state excise taxes on gasoline.

Drivers in California already pay the highest average for gasoline after Hawaii, and the Golden State has the second-highest gas taxes after Pennsylvania when combining state, local and federal gas taxes, according to GasBuddy.

Last year, Gov. Jerry Brown signed into law a 12 cent-per-gallon increase in the state's excise tax on gasoline, bringing the tax to 41.7 cents per gallon, or a 40 percent jump. As of Friday, California motorists were shelling out an average of $3.32 per gallon for gasoline, well above the national average of $2.52, according to AAA.

A repeal effort is underway to get rescind the tax increase. The campaign, which involves groups including the Howard Jarvis Taxpayers Association, is still gathering enough signatures to qualify for the November ballot.

However, President Donald Trump last week proposed an additional 25 cents per gallon federal tax to help pay for his $1.5 trillion infrastructure plan. It remains to be seen if Congress will agree to the plan, which would be the first federal gas tax increase since 1993.

Some have suggested the president's backing of a federal gas tax increase could undermine repeal efforts in California. Ironically, that could help Brown, a Democratic governor who has ripped Trump on several occasions, including on immigration and the environment.

Trump's infrastructure plan essentially encourages local and state-led efforts, so California will have to come up with more funds to cover large projects, such as new highways, and it could potentially use money from the increased state gas tax.

As a result, some say California's pursuit of more transportation projects with the state gas taxes could give it an edge when asking for federal matching funds under the Trump infrastructure plan.

Yet some of the backers of California's gas tax repeal effort see it differently and believe Trump's support for an increase in federal gas taxes will actually help their cause.

"If there's a pending 25 cent additional tax on top of the tax we just paid, I think that would be a huge incentive for Californians to say, 'gee, we're being crushed here — we can't do anything about the federal tax but there's something we can certainly do about the state tax,'" said Jon Coupal, president of the Howard Jarvis Taxpayers Association.

Regardless, Coupal is optimistic about the repeal campaign. He said at least 450,000 signatures were gathered through Thursday to get the measure on the statewide ballot this fall. He also described the campaign as "on track" to reach the required number of signatures — roughly 585,000 — by the May 21 deadline.

"I know that really upsets the governor and I know it upsets the construction industry and the labor unions," said Coupal. "But I think this is something that's extremely popular with voters out there."

In the retiring California governor's final state of the state address last month, Brown vowed to "do everything in my power to defeat any repeal effort that gets on the ballot."

California's gas tax hike along with vehicle fee increases were part of a transportation funding package to provide about $52.4 billion over the next decade to repair bridges, potholes and improve public transportation. The jump in gas taxes became effective Nov. 1.

Coupal said he isn't against fixing highways or repairing bridges but said the state has a poor track record for using existing funds for such needs.

"California's general fund has increased $36 billion in five years and not 1 cent has gone for road construction," said Coupal. "It's gone for everything but transportation."

A poll released Feb. 7 by the Public Policy Institute of California showed California voters are split on repealing the gas tax hike. When asked whether they favor the repeal, 47 percent favored it and 48 percent were opposed. It found strongest support for repeal among Republicans.