Democrats' Valentine to California Drivers: New Taxes

Tuesday, February 14, 2017

SACRAMENTO – Today, Democrats on the Senate Transportation and Housing Committee wished California taxpayers a “Happy Valentine’s Day” by voting to advance Senate Bill 1 (Beall, D-San Jose), which would significantly increase gas taxes and vehicle registration fees in California. Senator Mike Morrell (R-Rancho Cucamonga) opposed the measure.

“For years, legislative Democrats have refused to make our state’s aging infrastructure a spending priority,” said Morrell. “They are laser-focused on raising taxes rather than first considering where reforms and efficiencies can be made with existing resources. Californians already pay enough for the services and programs they expect. It is wrong for the state to go back to them for more.”

Among the tax and fee increases included in SB 1:

  • Gasoline excise tax: 12 cents per gallon, phased in over three years
  • Price-based excise tax: 7.5 cents per gallon
  • Diesel excise tax: 20 cents per gallon
  • Diesel sales tax: 4% per gallon
  • Vehicle Registration Fee: $38 per vehicle annually
  • Electric Vehicle Registration Fee: $100 per zero-emission vehicle

If that is not enough, all tax rates and fees created in SB 1 will be increased every three years based on the Consumer Price Index.

“California drivers are among the highest taxed in the nation and yet have to navigate some of the worst roads,” continued Morrell. “Now the state is asking taxpayers to trust it with more of their hard-earned money, even though the government has not upheld its end of the bargain to maintain our highways. With the state’s track record of broken promises, including diverting as much as $1 billion per year away from transportation projects, they are right to be skeptical that this one will be kept.”

Polls conducted by the Public Policy Institute of California and the Institute for Governmental Studies at UC Berkeley have shown that Californians consistently oppose the idea of higher gas taxes and vehicle fees.

During the 2015/16 First Extraordinary Legislative Session, Senate Republicans proposed a plan that would have made critical reforms and used existing funds to pay for roads and highways.

SB 1 is next scheduled for consideration by the Senate Committees on Environmental Quality and Governance and Finance.