SACRAMENTO, Calif. (Transatlantic Today) – Californians paying the country’s highest gas costs might soon get a tax cut, free public transportation trips, and up to $800 on debit cards to help to pay for petrol, according to Democratic Governor Gavin Newsom’s proposal released Wednesday.
The combination of pandemic-induced price inflation and Russia’s assault on Ukraine has caused gas prices to skyrocket in recent weeks. State governments around the nation have been discussing what to do next, with one of the most popular options being fuel tax reductions or taxpayer rebates. According to ABC NEWS, the governors of Georgia and Maryland passed bills temporarily halting their states’ gas taxes last week, while Georgia also gave $1.1 billion in reimbursements to taxpayers on Wednesday.
According to AAA, California’s average price of gas touched a new state high of $5.88 per gallon on Wednesday, over $2 higher than a year earlier. California has the nation’s 2nd-highest gas tax, at 51 cents a gallon. However, Democratic lawmakers in the state are skeptical about freezing the tax on gas because they are concerned that oil corporations would not transfer the savings on to consumers.
Rather, they want to deliver money directly to taxpayers.
According to the governor’s office, the regular California driver pays around $300 in gas taxes each year. Newsom proposes issuing $400 debit cards to auto owners for up to 2 cars, for a sum of $800. The money will go to anyone who has a vehicle registered with the state, including the ultra-wealthy, illegal immigrants, and even those who drive cars that don’t use fuel.
Newsom expects the state to cover for those who don’t have vehicles’ bus or train fares for 3 months. Newsom’s proposal would send $750 million to transportation and rail companies, enough to provide free trips to 3 million people every day, according to Newsom. Approximately $1.1 billion will be used to postpone planned diesel and fuel tax hikes this summer, as well as another $500 million will be used to fund programmes that promote cycling and walking.
Rising gasoline prices are a difficult policy problem for Newsom, who is attempting to wean California off fossil fuels. By 2035, he wants to outlaw the price of new gas-powered vehicles in the state, and by 2045, he wants to stop all oil extraction. He has suggested spending a sum of $10 billion over 6 years to increase zero-emission car production and create charging stations.
According to Laura Deehan, state director for Environment California, a group that works for the end of fossil fuel usage, higher gas costs often drive individuals to be more careful about their car use by walking more or reducing needless car journeys. She believes that giving away money for fuel will push them to drive more.
Instead, she suggested that Newsom invest the $9 billion on initiatives geared at drawing people away from gas-guzzling vehicles.
Newsom’s plan must pass the Legislature, which is dominated by Democrats both in the Senate and the Assembly. Democratic lawmakers, on the other hand, are opposed to handing money to the wealthy. They’ve been debating their own rebate plan, which would provide $200 refunds to every taxpayer and their dependents with taxable income of less than $125,000 for individual taxpayers and $250,000 for joint filers. A family of 5 would be eligible for $1,000, whereas a single parent with 2 children would be eligible for $600.
Newsom’s proposal is similar to one introduced last week by some moderate Democrats in the state Assembly, which would offer every taxpayer in the state $400 irrespective of income. Assemblywoman Cottie Petrie-Norris, a Laguna Beach Democrat who favors the plan, encouraged Newsom and the Legislature to act fast on Wednesday.
Newsom’s office stated that he would be prepared to negotiate with legislators on who should receive the funds, a process that might take some time to complete.
Republicans argue that a temporary ban of the state’s gas tax is the most expedient method to provide assistance. Rebates like the ones proposed by Newsom take time to arrive, with the governor ‘s office estimating that people will receive the money by July.
