California lawmakers will hold a special public hearing Feb. 22 to consider Gov. Gavin Newsom’s plan to impose a windfall tax on oil companies.
The proposal would place mandatory caps on oil refinery profits and add industry regulations and oversight, according to the governor.
The state Senate committee meeting comes months after Newsom first started accusing larger oil companies of price gouging and proposed the tax last year as gas prices skyrocketed at the pump, reaching $6.44 in June and $6.42 in October on average.
“This fall, Californians were once again saddled with record gas prices as big oil reached record profits,” he said. “This time, though, we’re going to do something about it.”
The governor said the penalty would not become another gas tax for Californians while oil industry officials claimed it would.
“I think it’s important that Californians understand this is a tax,” Western States Petroleum Association spokesman Kevin Slagle told The Epoch Times. “The governor can call it whatever he wants, but it’s a tax. And when you tax a commodity like fuels that usually impacts costs at the pump.”
Californians currently pay 53.9 cents of tax per gallon—the highest in the nation—after raising its gas tax rate in July. Additionally, the state adds federal excise tax and environmental cap-and-trade fees to that, bringing the total to about $1.28 a gallon.
Nicole Jacobs, spokeswoman for Energy In Depth, told The Epoch Times that Newsom’s “price-gouging” penalty was an attempt to shift blame from what’s actually causing high prices.
She said that Californians pay the most because of multiple factors, including “high taxes, a lack of infrastructure, and misguided policies that stifle investment and force the state to import increasing volumes of foreign oil.”
“The solution to combat high prices at the pump is more domestic energy production, not less,” she added.
The Senate Committee on Energy, Utilities, and Communications is expected to start the public hearing at 1:30 p.m.
