Gov Newsom considers $800 energy rebate for car owners as gas prices surge

Specifications for California

In total the bill would provide $11billion in relief. California residents will see $9billion in direct relief, according to a press release.

The rest of the money will be spent on broader relief such as:

• $750 million in incentive grants to transit and rail agencies to provide free transit for Californians for 3 months. As a result, roughly 3 million Californians per day who take the bus, subway, or light rail won’t have to pay a fare every time they ride.
• Up to $600 million to pause a part of the sales tax rate on diesel for one year.
• $523 million to pause the inflationary adjustment to gas and diesel excise tax rates.

The package also calls for $500million for projects that promote biking and walking throughout the state.

California’s possible fix

On Wednesday, California Governor Gavin Newsom announced on Twitter a plan to offer $9billion in tax refunds to help residents deal with rising gas prices.

Tens of millions of Californians will be eligible for $400 per registered vehicle for up to two vehicles per person. Newsom is also proposing grants for public transit to make it free for three months.

If approved by the state Legislature, the first payments could begin in July, according to NBC 4.

Quartlery tax rebate

Revenue raised from windfall profits will be returned to consumers in a quarterly rebate. This would phase out for single filers who earn more than $75,000 in annual income and joint filers who earn more than $150,000.

At $120 per barrel of oil, there would be approximately $45 billion per year made in revenue. For this price single filers would receive approximately $240 each year and joint filers would receive roughly $360 each year.

Big Oil Windfall Profits tax, continued

A press release states the bill would provide consumers with relief while maintaining American competitiveness and reducing pressure on inflation by attacking corporate profiteering.

Large oil companies that produce or import at least 300,000 barrels of oil per day, or did so in 2019, will owe a per-barrel tax equal to 50% of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019.

The quarterly tax will apply to both domestically produced and imported barrels of oil to ensure a level playing field, but smaller companies that account for about 70% of domestic production will be exempt.

Big Oil Windfall Profits tax

According to Senator Sheldon Whitehouse of Rhode Island’s website, this tax would “protect consumers from giant oil companies taking advantage of world events to jack up the prices.”

The legislation is co-sponsored by 11 other senators, including Elizabeth Warren (D-MA), Cory Booker (D-NJ), and Bernie Sanders (I-VT).

“We can no longer allow big oil companies, huge corporations and the billionaire class to use Putin’s murderous invasion of Ukraine and the ongoing pandemic as an excuse to price gouge consumers. It is time to enact a windfall profits tax,” said Sanders.

How much is gas across the country?

The national average gas price on March 23 was $4.23, according to the AAA, and topped $6.02 in Los Angeles and other parts of California.

This time last year, the national average price was $2.81.

What will fund the ‘gas stimulus check?’

The initial proposal on Representative Mike Thompson’s website did not specify where funding would come from.

A separate proposal from Democrat Representative Ro Khanna of California and Senator Sheldon Whitehouse of Rhode Island would provide a quarterly gas tax rebate instead of a direct payment.

That proposal would be funded by a levy on oil and gas companies called the Big Oil Windfall Profits Tax.

‘We must work together’

“Americans are feeling the impact at the pump of Vladimir Putin’s illegal invasion of Ukraine, and right now we must work together on commonsense policy solutions to ease the financial burden that my constituents are feeling,” Rep Mike Thompson said of the proposal, according to Fox5.

Who introduced the proposal?

Representatives Mike Thompson (CA-05), John Larson (CT-01), and Lauren Underwood (IL-14) introduced the Gas Rebate Act of 2022, according to a statement on Thompson’s website.

It is meant to address high gas prices by sending Americans an energy rebate of $100 per month.

It would also send them $100 for each dependent.

The rebates would be sent for the rest of 2022 in any month when the national average gas prices exceed $4 a gallon.

What is the ‘gas stimulus check’?

The Gas Rebate Act of 2022 proposal would see Americans get a monthly energy rebate of $100 per month.

Who controls gas prices, continued

Prices increase even more when the conflict is in oil-producing countries, like Russia, which is the world’s top exporter of crude and oil products.

The demand of consumers has also driven the price up.

More people are traveling now than ever before, after spending so much time at home due to the pandemic.

More people flying and driving, along with international impacts, mix with distribution costs and taxes to increase the price of gas.

Who controls gas prices?

Gas prices in the US are determined by a variety of factors, mostly supply and demand.

Whenever there’s an international conflict, such as the Russian invasion of Ukraine, the prices of crude oil increase, which causes an increase in the price of gas.

Crude oil and refining account for up to 70 percent of the price of gas, according to U.S. Energy Information Administration.

Can Biden lower gas prices, continued

Biden could also increase domestic energy production, but this would go against efforts to combat climate change.

More petroleum has already been released from the country’s reserves, but it had little impact on the price at the pump.

In a speech on March 8, 2022, Biden announced a ban on Russian oil and other energy imports as retaliation for the Ukraine invasion.

He said this will cause another jump in gas prices.

Can Biden lower gas prices?

Unfortunately, there is not much President Biden can do to provide a quick drop in prices.

One option he has is to suspend the Federal Gas Tax, which is currently 18 cents per gallon.

However, this tax largely funds projects in Biden’s infrastructure spending bill, so cutting it could bring them to a halt.

The president could also allow Winter gasoline to be used through Summer.

Costco memberships for cheaper gas, continued

“If gas prices stay where they are, I should save $430 roughly over the next year, and more if prices go up,” one shopper, Koshin Jimcali, told Insider.

“Definitely worth the $60 investment for membership,” he said.

Costco memberships for cheaper gas

Insider reported that many consumers have already signed up for Costco memberships just for the sake of getting cheaper gas.

Shoppers claim that even with the annual membership fee, which starts at $60 a year, they will save money.

Wholesale clubs and cheap gas, part three

On top of potentially saving money, many clubs’ members can get cash back as well.

For instance, consumers who use the Costco Anywhere Visa card get 4 percent cashback for filling up at any gas station.

Gas station rewards cards and signing up for gas station apps could also help customers save 5-10 cents off a gallon, which can really add up.

Wholesale clubs and cheap gas, continued

Gas sales at warehouse clubs have been a longtime perk for club membership by building loyal customers through their consistently lower prices at the pump.

“People are seeking out the clubs because of the gas,” retail analyst Michael Baker told an ABC affiliate.

“It’s US consumers’ nature to go out of their way for lower gas prices.”

Wholesale club members can get cheap gas

One way to save at the gas pump is to fill up your tank at warehouse clubs like Costco, Sam’s Club, or BJ’s Wholesale Club.

Warehouse clubs typically sell fuel at 30 cents less per gallon than regular gas stations.

Plus, the chains often offer coupons and membership discounts to help soften the blow even further.

‘That’s a really bad idea’

Not everyone supports ditching the gas tax in California, as some lawmakers have proposed.

UC Berkeley professor Severin Borenstein, who specializes in energy, told the San Francisco Gate: “That’s a really bad idea. Besides the fact that it pays for a lot of infrastructures, it also represents costs not included when we burn gas like local pollution, congestion on roads and the risk to pedestrians when we choose to drive.”

“None of that is priced into the price of gasoline, and those costs would go up if we completely removed the gas tax.”

How much can you get with GetUpside?

GetUpside partners with nearby businesses to bring you offers and savings.

When you’re on the app, you’ll be able to pick and choose the local offers, which also include restaurants and groceries.

Bree explained you can get back anywhere between 15 cents to 30 cents per gallon every time you fill-up.

She said if you use her code, BREE20, you can receive an additional 20 cents per gallon on your first fill up.

What is GetUpside, continued

You will need to save a debit or credit card on the app.

This will allow you to choose the card you would like your cash to be credited to.

BreeTheCouponQueen said you have 20 minutes from the time you check in to fill up and pay with the card you chose.

What is GetUpside?

GetUpside is a free app that gives you cash back every time you buy gasoline.

Once you check-in, the app will determine your location.

TikTok user BreeTheCouponQueen explained that the app will show you what gas stations are near you, and how much cash back per gallon they are offering.

Next, click on the gas station to claim the offer.

Second-largest jump ever

GasBuddy noted this latest increase in gas prices has been the second-largest jump we have ever seen.

The highest jump was right after Hurricane Katrina during the week of September 3, 2005, when gas increased an average of $0.45 per gallon.

When will gas prices readjust?

According to David Kelly, chief global strategist at JPMorgan Funds, in a research report, the price of gas might fall later this year, according to CBS News.

He said that this would be contingent on increased shale oil production in the US and increased supply from OPEC countries, among other factors.