High Costs and Few Benefits from California’s Proposed Sustainable Aviation Fuel Tax Credit
Aaron Smith
This credit would reduce road funding, raise gasoline and diesel prices, and deliver small and expensive carbon emissions reductions.
In California, road construction, maintenance, and repairs are funded primarily through excise taxes on gasoline and diesel. The Governor’s latest budget includes a proposal that would diminish this dedicated source of revenue. It would allow fuel suppliers to reduce their diesel excise tax liability by selling sustainable aviation fuel (SAF).