California, October 13, 2025
News Summary
Starting July 1, 2024, California will see a gas price increase due to a 1.6 cents per gallon tax hike and stricter air quality rules that could add another 5 to 8 cents. Average annual gas taxes for households will exceed $600. These changes come as California aims for environmental sustainability amidst a projected decline in gas tax revenue by 2035.
California
Starting July 1, 2024, gas prices in California are set to rise due to an annual increase in the state’s gas tax and the introduction of stricter air quality regulations. The gas tax will increase by 1.6 cents per gallon, adding to California’s already high gas tax rate of approximately 59 cents per gallon, which will rise to 61.2 cents per gallon. This means that the average household in California will be paying over $600 per year in total gas taxes.
Additionally, Governor Gavin Newsom’s office has announced that new air quality regulations, effective the same day, may contribute to gas prices increasing by an estimated 5 to 8 cents per gallon. The current average price for a gallon of regular unleaded fuel in the Los Angeles – Long Beach area stands at $4.61, which is down 18 cents compared to the previous year, offering some short-term relief ahead of the summer holiday season.
California’s gas tax is the highest in the country, and these new adjustments reiterate the state’s ongoing efforts to promote environmental sustainability and reduce emissions. The tax on diesel fuel will also see a rise, increasing from 45.4 to 46.6 cents per gallon.
According to Caltrans, gas-powered vehicles in California currently contribute approximately $300 a year in state gas taxes. However, legislative analysts predict that gas tax revenue will experience a significant decline, dropping by $5 billion or 64% by the year 2035. This projection comes as the market share of zero-emission vehicles continues to grow, leading the state to consider phasing out gas taxes entirely in favor of a California Road Charge. This charge would bill drivers based on mileage rather than gallons used.
A pilot program for the road charge was launched in August 2024 and concluded in January 2025, with results anticipated later this year. Currently, motor fuel taxes account for a significant portion of transportation revenue in California, although this percentage has declined from 41% in fiscal year 2016 to roughly 36% in fiscal year 2024.
The state is aligned with Oregon’s goal to have all new passenger cars sold be zero-emission vehicles by 2035. The California Air Resources Board (CARB) has approved changes to the Low Carbon Fuel Standard program, likely resulting in increased costs at the pump. Although initial estimates suggested that recent amendments could raise gasoline prices by up to 47 cents per gallon, these estimates were later revised.
As global oil prices remain unpredictable due to various geopolitical and domestic factors, the upcoming price hikes add to the complexities surrounding California’s gas market. Despite earlier predictions of gas prices soaring to $8 per gallon by 2026, this information has been debunked by Newsom’s office, aiming to mitigate public concern about gas price fluctuations.
Key Features of California’s Gas Price Changes
| Feature | Details |
|---|---|
| Gas Tax Increase (Effective July 1) | 1.6 cents per gallon |
| Total Gas Taxes for Average Household | Over $600 per year |
| Current Average Gas Price | $4.61 per gallon (Los Angeles – Long Beach) |
| New Diesel Tax Rate | 46.6 cents per gallon |
| Projected Gas Tax Revenue Decrease by 2035 | $5 billion, or 64% |
| California Road Charge Pilot Program | Concluded January 2025 |
FAQ
What will happen to gas prices in California on July 1, 2024?
The gas tax will increase by 1.6 cents per gallon, along with stricter air quality regulations that may add an estimated 5 to 8 cents per gallon to gas prices.
What is the current average price of gas in Los Angeles?
The average price for a gallon of regular unleaded in the Los Angeles – Long Beach area is currently $4.61.
How much do gas-powered vehicles contribute to state gas taxes?
Gas-powered vehicles in California contribute approximately $300 a year in state gas taxes.
What long-term changes are being considered for gas taxes in California?
The state aims to phase out gas taxes in favor of a California Road Charge that would charge drivers based on mileage instead of gallons used.
Deeper Dive: News & Info About This Topic
- ABC7: California Looks to Eliminate Gas Tax
- Wikipedia: California
- Los Angeles Times: Gas Prices in July
- Google Search: California gas prices 2024
- NBC Los Angeles: Gas Prices Rise on July 1
- Google Scholar: California gas taxes
- FOX LA: California Gas Prices Increase July 1
- Encyclopedia Britannica: California gas tax
- Politico: Newsom’s California Fuel Standards
- Google News: California gas market 2024
Author: STAFF HERE CORONADO
The Coronado Staff Writer represents the experienced team at HERECoronado.com, your go-to source for actionable local news and information in Coronado, San Diego County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Coronado Island Film Festival, productions at Lamb’s Players Theatre, community workshops at John D. Spreckels Center, and iconic celebrations at Hotel del Coronado. Our coverage extends to key organizations like the Coronado Chamber of Commerce and Visit Coronado, plus leading businesses in hospitality, dining, and tourism that drive the local economy. As part of the broader HERE network, including HERESanDiego.com, HEREHuntingtonBeach.com, HERELongBeach.com, and HERELosAngeles.com, we provide comprehensive, credible insights into Southern California's dynamic landscape.
