NJ gas tax to drop Oct. 1 but only barely
New Jersey's gas tax rate will drop by a penny on Oct. 1.
The state Treasury Department reviews the gas tax based upon consumption and revenue generated in order to generate a minimum of $2 billion per year needed for $16 billion worth of infrastructure projects paid for by the Transportation Trust Fund. Gov. Chris Christie signed the tax into law in 2016.
"Because actual consumption in Fiscal Year 2022 was moderately above our projections made last August, and consumption in the current fiscal year is projected to be slightly above last fiscal year’s levels, our analysis of the formula dictates a 1.0 cent decrease this coming October,” State Treasurer Elizabeth Maher Muoio said in a statement.
NJ's gas tax is really the total of two separate taxes
The Petroleum Products Gross Receipts tax will drop from 31.9 cents to 30.9 cents for gasoline and from 35.9 cents to 34.9 cents for diesel fuel. The Motor Fuels Tax is fixed at 10.5 cents for gasoline and 13.5 cents for diesel. The totals effective October 1 are 41.4 cents for gas and 48.4 cents for diesel respectively.
The gas tax fell 8 cents per gallon in August 2021.
Gov. Phil Murphy has cited the requirements of the Transportation Trust Fund as the reason the state could not reduce or eliminate the gas tax when prices were climbing in the spring and early summer towards $5 per gallon.
15 cents a week savings
GOP State Sen. Ed Durr said the decrease is not going to have a real impact on the price at the pump and might only save drivers 15 cents per week. He pushed for support for his bill that would provide drivers immediate $500 rebates to offset gas prices.
“The immediate $500 rebate I proposed would help a lot of New Jersey families who can’t keep up as costs continue to rise. It would make a much bigger difference than 15 cents," Durr said.
After peaking at an average of $5.059 in June average prices have dropped back to $3.94 according to AAA's latest survey. The U.S. average is $3.85.
Tom Kloza, global head of energy analysis for the Oil Price Information Service, said this trend has been continuing because people are driving less and the weather has been cooperative.
Kloza said barring some major weather event in the Gulf of Mexico, prices should continue to fall.
Previous reporting by David Matthau was used in this report.