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New Jersey gas tax hike set to begin just weeks after toll increases

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Posted at 3:30 PM, Sep 29, 2020
and last updated 2020-09-29 15:30:40-04

TRENTON, N.J. — New Jersey drivers will have to dig deeper into their pockets to pay for gas starting Thursday.

The state’s gas tax will be raised by 9.3 cents per gallon — a roughly 22% increase — from 30.9 cents to 40.2 cents, according to the state Treasury Department. The tax on diesel fuel will increase from 34.9 cents to 44.2 cents.

The agency announced the tax hike last month, citing a 2016 law that requires the state maintain $16 billion over eight years for the Transportation Trust Fund, which supports improvements to bridge and road infrastructure. To ensure the necessary funds, the law mandates the state adjust the gas tax rate accordingly so that about $2 billion in revenue is generated per year.

State Treasurer Elizabeth Maher Muoio said in August the factors that decide the tax rate are “beyond the control of the administration.”

“The law enacted in 2016 contains a specific formula to ensure that revenue is meeting a certain target. When it does not, the gas tax rate has to be adjusted accordingly in order for us to meet our obligation under the law and fully fund the state’s many pressing transportation infrastructure needs,” Muoio said. “Highway fuels consumption took a significant hit in [fiscal year] 2020 because of the economic downturn caused by the COVID-19 pandemic.”

According to the Treasury Department, gas consumption dropped by 38.7% from March to May and diesel fuel consumption fell by 16.5%, as more residents worked from home and limited travel because of the pandemic.

The gas tax hike comes on the heels of another cost increase affecting drivers in New Jersey: tolls.

Toll increases on the New Jersey Turnpike, Garden State Parkway and Atlantic City Expressway went into effect on Sept. 13.

Those funds will help support a $24 billion construction capital plan that spans several decades.

This story comprises reporting from The Associated Press.