California gas tax increases July 1: What to know

Beginning July 1, you'll be paying more for gas in California as the state's gasoline tax increases again. 

Prices at the pump go up by 4 cents per gallon, increasing the excise tax rate from around 54 cents per gallon to 58 cents per gallon. 

This automatic increase is due to Senate Bill 1 which was signed into law in 2017 and incrementally raises the fuel excise tax each year. 

SUGGESTED: California considers replacing gas tax with mileage tax

According to the state, most of the money goes to fix potholes and rebuild deteriorating roads, and bridges, and to improve public transportation.

The average price of a gallon of self-serve regular gasoline in Los Angeles County rose two-tenths of a cent Friday to $4.89, one day after a run of 15 decreases in 17 days totaling 8.6 cents ended when it was unchanged.

The average price is 2.6 cents less than one week ago, 4.7 cents lower than one month ago and $1.437 below what it was one year ago, according to figures from the AAA and the Oil Price Information Service. It has dropped $1.604 since rising to a record $6.494 on Oct. 5.

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The national average price dropped for the seventh consecutive day, decreasing six-tenths of a cent to $3.543. It has dropped 4.1 cents over the past seven days, including seven-tenths of a cent Thursday.

The national average price is 3.6 cents less than one month ago and $1.314 lower than one year ago. It has dropped $1.473 since rising to a record $5.016 on June 14, 2022.

Right now California lawmakers are considering replacing the gas tax with a mileage tax in part due to fuel efficiency and the rise of electric cars. 

So far, only three states — Oregon, Utah and Virginia — are generating revenue from road usage charges, despite the looming threat of an ever-widening gap between states’ gas tax proceeds and their transportation budgets. Hawaii will soon become the fourth.

The federal government is about to pilot its own such program, funded by $125 million from the infrastructure measure President Joe Biden signed in November 2021.

Many states have implemented stopgap measures, such as imposing additional taxes or registration fees on electric vehicles and, more recently, adding per-kilowatt-hour taxes to electricity accessed at public charging stations.

The Associate Press and City News Service contributed to this report.