Gov. Newsom submits plan to ease gas burden on California car owners

On Wednesday, Democratic California Gov. Gavin Newsom proposed a plan to assist in easing the burden of higher gasoline prices on drivers in the state, including giving cash to car owners and providing free public transportation temporarily as well as reducing fuel taxes.

The plan outlines $400 in direct payments to Californians per vehicle they own, which would be capped at two vehicles.

As written, the plan does not have an income cap for the payouts. According to AAA data, the average price of regular unleaded gasoline in California has hat $5.88 per gallon, as some neighborhoods have been charging over $6 per gallon. Right now, the national average for a gallon of gas is $4.24.

The prices have hit record highs nationally due to the Russian invasion of Ukraine, as traders as well as shippers and financiers have rejected Russian oil, eliminating much of it from the daily global supply.

Lawmakers in several other states are also aiming to pause or lower the collection of gasoline taxes in their states. At the federal level, several members of Congress have encouraged the Biden administration to put off federal taxes on fuel for the time being.

Typically, gasoline prices in California are already higher than in other states because of California’s higher taxes and stricter regulations. 

Newsom’s proposed tax refund would come in the form of $400 debit cards for the owners of registered vehicles, even electric-vehicle owners, as every person is eligible to receive as many as two payments. The rebates stand to cost the state around $9 billion. “That direct relief will address the issue that we all are struggling to address,” Newsom commented.