New Jersey gasoline tax cut takes effect Friday
TRENTON – If you need gas for your car but want to save a dollar or two, you might want to wait until Friday – when New Jersey’s gasoline tax drops 8.3 cents a gallon.
State officials adjust the gasoline tax each year on Oct. 1 under a 2016 law that sets an annual revenue target of around $ 2 billion. Depending on the collections of the past year and expectations for the coming year, the tax may increase, remain stable or decrease.
This is the first cut since the law came into force. Treasury officials credited the faster-than-expected recovery of the pandemic by reversing most of the 9.3-cent-per-gallon hike imposed a year ago.
Part of the rationale for the annual tax rate adjustments was to keep increases small and predictable. But the tax has been on a yo-yo since the initial increase of 22.6 cents in 2016 – level in 2017, up in 2018, level in 2019, up in 2020, now down.
The state’s gasoline tax effective Oct. 1 will be 42.4 cents per gallon, down from 50.7 cents. The tax on diesel fuel is 7 cents higher per gallon, or 49.4 cents.
New Jersey will drop from the nation’s fourth-highest gasoline tax to its 11th-highest, according to data from the Tax Foundation.
The gasoline tax is reduced by around 16%. AAA says the average price of gasoline in New Jersey for a gallon of regular gasoline is currently around $ 3.23, so the tax change may represent an overall reduction per gallon of about 2 , 5%.