New Jersey's Gas Tax Increase: Just Another Way to Pump Money Out of Our Pockets
New Jersey drivers will soon feel an extra pinch at the pump as the state's gasoline tax rises by close to a penny per gallon starting October 1st. This will bring New Jersey's total gas tax up to 42.3 cents per gallon, making it the 7th highest rate among all 50 states.
The increase comes as a result of a 2016 law that requires automatic annual adjustments to the state's motor fuels tax in order to generate a targeted $2 billion in annual revenue for New Jersey's Transportation Trust Fund. This program finances critical road and bridge repairs statewide.
The incremental tax hike was triggered because gas tax collections in the last fiscal year fell slightly short of projections, likely due to decreased diesel fuel consumption.
Over the past several years, New Jersey has seen its gasoline tax climb by around 30 cents per gallon. In 2016, legislators approved a major 23 cent per gallon increase - the state's first gas tax hike since 1988. That move was billed as necessary to fund an 8-year, $16 billion transportation infrastructure improvement program.
The 2016 law also established the variable tax rate structure tied to annual revenue goals. Proponents reason this provides a reliable method to ensure sufficient funding is available to maintain and upgrade New Jersey's aging transportation network.
Even after this latest increase, New Jersey's gas tax will remain substantially lower than Pennsylvania's rate of 62.2 cents per gallon, which ranks as the 3rd highest nationally. But it will be nearly 6 cents higher than neighboring New York's gas tax.
As prices at the pump continue rising across the US, the incremental tax bump in New Jersey will further strain drivers and businesses already impacted by inflation and high fuel costs. State leaders will face ongoing pressure to balance infrastructure funding needs with the economic burdens the ever-growing gas tax places on taxpayers.
