Californians pay high gas prices and high gas taxes yet still drive on bad highways

California’s average price for regular grade gas has again topped $5 a gallon, according to the most recent American Automobile Association report. It’s more than $6 in some areas. The average is up about 20 cents from a year ago and is about $1.50 higher than the national figure.

A couple of years ago, Gov. Gavin Newsom spent months vilifying oil companies as price-gouging enemies of the people and demanded that the Legislature punish them with taxes on excess profits. He couldn’t win approval the tax proposal, switched to seeking civil penalties, and ultimately had to settle for relatively toothless legislation directing the state Energy Commission to gather data, establish a reasonable profit level and assess penalties for exceeding it.

Severin Borenstein, a UC Berkeley economist regarded as the state’s leading expert on the issue, parsed the differential in a 2023 paper, pointing out that California’s direct and indirect taxes on fuel amount to nearly $1 per gallon – 70 cents higher than the national average in such taxes – and the state’s unique fuel blend to battle smog adds another dime.

This month’s sojourn through other western states underscored another aspect of the gas-price conundrum. Despite paying direct and indirect taxes on fuel that are three times the national average, California’s motorists are driving on highways that are subpar vis-à-vis those in other states.

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