Public Skeptical of Calif. Oil Tax Proposal
Editor’s Note: California is tied with Connecticut for having the highest taxes on gas in the country. However, a state legislator has proposed that the state begin taxing oil pumped from wells in California which would likely lead to higher prices at the pump. The new tax revenue would go for education and state parks, according to the bill’s sponsor. CBS News San Francisco filed the following story on this latest development.
In one week, gas prices have jumped 12 cents, and as they continue to climb, a California lawmaker is proposing a new tax to be paid on every barrel of crude oil produced in the state.
“That’s ridiculous. It’s insane, no one is going to go anywhere,” Sacramento resident Lindsey Griffiths said.
But, a new oil tax is exactly what Sen. Noreen Evans, D-Santa Rosa, is suggesting.
“California is the only oil-producing state in the nation that does not have an oil extraction tax. States such as Texas, Oklahoma and Alaska have such a tax, and it just makes common sense,” Evans said.
The senator is proposing a 9.9% tax on every barrel of oil drilled in California. With the current cost running roughly $97 per barrel, the tax would equal $9.60 per barrel.
According to the California State Board of Equalization, it means oil companies will have to pay out more than $2 billion each year in extra taxes. That money is set to go to state parks and California universities. However, drivers are pretty sure they’ll be the ones paying for it in higher prices at the pump.
“You look at all these cars out here and they’re being used and I guess someone had a brainstorm on it and said ‘why not?’ ” Rancho Cordova resident Chuck Bell said.
“Unfortunately, what happens is the politician gets paid first, the guy who is out there on the street is second, and then the kids wind up forth or fifth,” Sacramento resident Armando Barbosa said.
However, some are more concerned about where the money will end up.
“Someone needs to make sure those dollars actually funnel back into the school system and not in other peoples’ pockets,” Sacramento resident Melvin Henley said.
With Democrats controlling the House and the Senate, Republicans worry more tax hike bills will have little trouble getting to the governor’s desk.
“This is bad policy and something we absolutely shouldn’t stand for,” said Sen. Tom Berryhill, R-Modesto. “This absolutely hurts working families in California.”
On each gallon of gas sold in California, 18.4 cents goes to federal taxes and 35.7 cents goes to state taxes on top of a 2.25-cent sales tax. County and city taxes are 10.65 cents, which brings the total figure up to 67 cents per gallon on average across California.