Michelle Steel: Tax increases stifle California’s economy and harm working families
California taxes continue to rain down on families thanks to a state government that thinks they know how to spend your money best. The latest hardship is yet another increase in the state gas tax, which now sits at a highest-in-the-nation 60 cents per gallon as families kickoff summer travel.
The increase is part of a years-old scheme to enlarge state government at the expense of taxpayers. After voters took the commonsense step in 2002 of requiring gas taxes to be used for actual transportation needs, liberal Sacramento politicians sidestepped voter wishes and swapped the traditional gasoline tax for a state excise tax on gasoline. They then set up a bureaucratic process to raise this tax annually, with proceeds propping up pet projects rather than solely supporting vital infrastructure.
It’s a shell game at its finest. Unfortunately, as is often the case in California, liberal politicians got their wish, and the tax continues to rise.
Southern California families deserve better. We already pay more in gas taxes than residents of any other state – a total of 78 cents per gallon when combined with federal taxes. And our current average price sits at $4.79 per gallon, compared to the national average of $3.50 per gallon.
As Governor, Gavin Newsom now owns this summer gas tax increase – and has the authority to stop it. But even in the face of California’s high state taxes and rampant inflation, he declined to suspend the gas tax hike that took effect on July 1.
Some of us tried to tell him. A May letter from California’s Republican delegation in Congress urged a suspension of the gas tax in light of the high cost of living already facing Californians. We also warned about an even higher increase in gas prices next year as anti-energy reforms from the California Air Resources Board (CARB) take effect.
These price increases come even as families struggle to afford basic necessities, with a recent report from the Joint Economic Committee finding that the average California household is spending $300 more per month than this time last year to maintain the same standard of living. This includes dramatic increases in food, housing, energy, and transportation-related expenses.
Californians are suffering enough under President Biden and Governor Newsom’s inflation. Now, Newsom’s tax hikes are making it unaffordable to drive, even as we already experience the highest retail gas prices in the nation. Rising gas taxes, along with high income and business taxes, continue to drive small businesses and middle-class Americans out of California.
Unfortunately, the opportunity for voters to have their say on high taxes in has been silenced by Newsom’s allies in the judicial branch. Governor Newsom and legislative leaders successfully sued to remove the Taxpayer Protection and Government Accountability Act from the ballot this fall, which would have required the Legislature to receive voter approval for any new or higher state tax.
Such a provision would have made it more difficult to implement new taxes, such as the excise tax on gasoline which now rises every year on July 1. It is telling that our state’s leaders are afraid to give voters a say on issues affecting their own pocketbooks, which are feeling increasingly strained in the current economic environment.
Relief at the pump is essential for Californians, and I will continue fighting harmful state policies which worsen the toll of inflation for my constituents. Out of fairness to working families, Governor Newsom must suspend the state gas tax now.
Michelle Steel represents California’s 45th congressional district and serves on the House Ways and Means Committee, the chief tax-writing committee of the U.S. House of Representatives.