New Jersey's gas tax drops 8.3 cents a gallon

The New Jersey gas tax rate went down 8.3 cents per gallon beginning Friday, Oct 1.  That's a drop of about 16%.

It is the first time the tax is going down during Gov. Phil Murphy's administration.  The state tax will drop from 50.7 cents a gallon to 42.4.

Officials announced the drop in August after a review of fuel consumption statistics and consultation with the Legislative Budget and Finance Officer.

"Because actual consumption in Fiscal Year 2021 was so closely in line with our projections made last August, coupled with the fact that consumption in the current fiscal year is projected to be above last fiscal year’s levels, our analysis of the formula dictates an 8.3 cent decrease this coming October," said State Treasurer Elizabeth Maher Muoio. "We are pleased that this dedicated funding stream continues to provide billions of dollars across the state to support our critical transportation infrastructure needs."

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New Jersey's gas tax is actually two separate taxes on gasoline and diesel fuel.

The annual evaluation of the gas tax comes as part of a 2016 law that required state funding to support bridge and road infrastructure at $2 billion annually for eight years. The law calls for yearly adjustments to the fuel tax if receipts don't meet that level.

Last year, the tax climbed by 9.3 cents a gallon. The year before that, it was flat, while in 2018 it climbed by more than 4 cents a gallon.

With the drop, New Jersey will drop from the fourth-highest gas tax in the country to 11th place.