The California State Board of Equalization voted Tuesday to decrease the state excise tax rate on gasoline from 39.5 cents per gallon to 36 cents, effective July 1 through June 30 of next year.
The BOE adjusts the gas tax by March 1 of each year. Historically, the adjustments have had little to no effect on gas prices for consumers.
The five-member BOE is a publicly elected tax board. The BOE collects $56 billion annually in taxes and fees supporting state and local government services.
“This proposed gas tax cut will give Californians a much-deserved tax break and help lower travel costs this summer. It has my full support,” said Board Member George Runner.
A law enacted in 2010 known as the “fuel tax swap” requires revenue neutrality, meaning motorists pay no more or less state tax on gasoline purchases than they would have prior to the swap. The new laws lowered the sales tax on gasoline to 2.25 percent and raised the excise tax by an amount projected to equal the sales tax that otherwise would have been collected under the old tax structure.
The BOE sets the excise tax rate annually based on the projected number of gallons drivers will purchase in the upcoming fiscal year.
