California gas tax refund: Gov. Gavin Newsom, lawmakers close to agreement

SACRAMENTO, Calif. – Most California taxpayers would receive hundreds of dollars in cash to offset high prices for fuel and other commodities under an interim budget compromise being discussed by Legislative leaders and Gov. Gavin Newsom.

The plan would return part of the record-breaking $97 billion budget surplus to taxpayers – but the money would only go to people earning below a certain income level.

Newsom and lawmakers were still negotiating the state budget on Friday, with talks expected to extend into the weekend. While both sides agreed on a framework for rebates, the totals could change as other parts of the budget are finalized. But in general, the less money people make in a year, the more money they would get from the state.

The current proposal would return about $9.5 billion to taxpayers. Single people earning less than $75,000 a year and couples earning less than $150,000 a year would get $350 per taxpayer, plus $350 for each dependent. That means a couple making $100,000 a year with one child would be making $1,050.

Singles earning less than $125,000 a year and couples earning less than $250,000 a year would each receive $250 plus their dependents. Singles earning less than $250,000 a year and couples earning less than $500,000 a year would each receive $200 plus their dependents.

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The proposal was endorsed by MP Miguel Santiago, a Los Angeles Democrat. Santiago announced the plan in a press release late Friday afternoon, calling it an agreement between Newsom and the Legislature. However, a representative from Santiago’s office later clarified that the deal is not yet finalized.

“As the prices of everything from gasoline to baby food soar, this rebate will help the vast majority of California taxpayers, including undocumented Californians, with hundreds of dollars in direct cash assistance and provide crucial relief during tough times,” Santiago said.

The statewide average price for a gallon of regular unleaded gasoline in California hit an all-time high of $6.44 last week. The median price on Friday was $6.35 a gallon, compared to the national average of $4.93.

Republicans, who don’t control enough seats in the state Legislature to pass anything, have urged Newsom and Democrats to temporarily suspend the state gas tax — the second-highest in the nation at 51.1 cents a gallon. The tax is set to rise to 53.9 cents a gallon next week, an automatic adjustment that’s part of a state law designed to keep pace with inflation.

Newsom and Democratic Party leaders have refused to suspend the gas tax, arguing that it would not guarantee a price drop large enough to benefit drivers. They also said it would cost construction jobs since the tax is paid for highway maintenance statewide.

Instead, months ago, they pledged to use the state’s budget surplus to send money directly to taxpayers. But nothing has happened so far because Newsom and legislative leaders couldn’t agree on how to do it. Newsom had proposed sending the money to registered vehicle owners, while lawmakers wanted the money sent to taxpayers.

The proposal announced on Friday is a compromise. The money would go to taxpayers instead of vehicle owners, but the checks would be larger than lawmakers originally suggested.

Copyright © 2022 by The Associated Press. All rights reserved.

https://abc7.com/california-gas-rebate-newsom-legislature/11994989/ California gas tax refund: Gov. Gavin Newsom, lawmakers close to agreement

Laura Coffey

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