NJ gas tax to rise 30 percent in October

NEW JERSEY - New Jerseyans will see the state’s gasoline tax shoot up 30 percent on October 1 as the state tries to generate enough money to fund the Transportation Trust Fund.

The tax on gasoline will increase from 30.9 cents to 40.2 cents per gallon, and from 34.9 cents to 44.2 cents for diesel fuel.

Combined with the state’s separate 10.5 cents a gallon Motor Fuels Tax rate on gasoline and the 13.5 cents tax per gallon of diesel fuel, gasoline’s total tax rate will jump to 50.7 cents a gallon, while diesel's total tax rate will rise to 57.7 cents per gallon.

“As we’ve noted before, any changes in the gas tax rate are dictated by several factors that are beyond the control of the administration,” said State Treasurer Elizabeth Maher Muoio.

The Transportation Trust fund is required to provide $16 billion over eight years to support infrastructure improvements to the state's roadways and bridges, and in order to support those projects, the tax rate must be adjusted accordingly to generate roughly $2 billion a year.

The Murphy administration blames people not driving as much because of the economic downturn caused by the COVID-19 pandemic.

The New Jersey Department of the Treasury noted that gasoline consumption in the state declined by nearly 40 percent from March to May during the state’s coronavirus shutdown, while diesel fuel consumption declined by over 16 percent.

Fuel consumption has remained low as many people are still working from home and limiting travel and extracurricular activity.

According to a study by the American Petroleum Institute, drivers in New Jersey pay the 10th-highest gasoline tax in the nation and the 7th-highest diesel tax in the nation.

The law that creates a steady source of transportation funding was signed into law in 2016 by Governor Chris Christie. (See 2016 coverage below)