PAIN AT THE PUMP: Days Of Cheap Gas Come To A Sad End In NJ

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For the first time in 316 months, or more than 26 years, New Jersey’s gas tax has gone up.

The next change could come in just two months.

New Jersey’s gas tax climbed from 14.5 cents per gallon, the second-lowest in the nation, to 37.1 cents per gallon, the seventh-highest. It had been estimated the hike signed into law Oct. 14 by Gov. Chris Christie would be 23 cents a gallon, but the math is more complicated than straightforward.

New Jersey levies both a retail-level tax of 10.5 cents a gallon and a wholesale-level tax of 4 cents a gallon.

(The retail tax was last raised in 1988. The wholesale tax was created in 1990 and converted to 4 cents a gallon in 1991. So when people say New Jersey’s gas tax hasn’t gone up since 1988, that’s not exactly the case.)

The hike taking effect today is levied at the wholesale level, rather than the retail one. Each refinery and wholesale distributor is responsible for collecting the tax from the gas station when fuel is delivered – which makes collecting easier for the state and minimizes the chance that taxes aren’t paid.

The new law sets the petroleum products gross receipts tax, as it’s called, at 12.85 percent. That rate was applied to the average retail price for gasoline in New Jersey, after subtracting existing federal and state taxes, and the math works out to an increase of 22.6 cents.

“The 22.6 cents-per-gallon tax increase is based on a tax rate of 12.85 percent on retail gasoline,” said Treasury Department spokesman Willem Wijksen. “It is adjusted at the beginning of each quarter in response to the change in the average price per gallon as determined from a random survey administered by the Board of Public Utilities.”

Those quarterly adjustments are to take effect each quarter, at the start of January, April, July and October. Whether they’re done or not remains to be seen; they were supposed to be done twice a year under a 1991 law, but that doesn’t appear to have been done. Also, any price-driven increases could be offset by an annual adjustment each fall that ensures the tax yields steady revenues for the state — no losses, but also no gains.

That level of detail wasn’t discussed as lawmakers debated and approved the bill a few weeks ago, despite intense public opposition.

The impact on drivers depends on what kind of car they drive and how many miles they travel.

A person who drives 15,000 miles a year in a car that gets 20 miles per gallon would pay about $170 more a year in gas taxes. Read more at 101.5 FM.

 

{Matzav.com}

1 COMMENT

  1. This will only hurt the bnai hayeshiva. The president should be ashamed this is pure chutzpah and reeks of amalache, where can it end. Petition anyone?

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