Hamilton, NJ – The New Jersey gas tax increase of November 2016, led to a change in gas-buying habits for those who live and commute in New Jersey, Delaware, and Pennsylvania. According to data from the Oil Price Information Service (OPIS) and AAA, the percentage of taxable gasoline sold in New Jersey (out of all taxable gas sold in New Jersey, Pennsylvania, and Delaware) dropped from an average of 43.68 percent to 41.98 percent, that translates to about 17.7 million gallons less per month in 2017 than in 2016.
Meanwhile, the amount of taxable gas sold in Pennsylvania and Delaware both rose in 2017, an average of 7.48 million gallons a month in Pennsylvania more than the average amount of gas purchased in 2016 and more than 208,000 gallons a month in Delaware.
In November 2016, New Jersey implemented a 23 cent-per-gallon in order to address infrastructure issues throughout the state and bringing the price at the pump up to higher levels than the neighboring states.
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Today, pump prices in Pennsylvania are highest in the region, with New Jersey pump prices coming in at 10 to 15 cents less, and Delaware prices anywhere from 10 to 15 cents lower than New Jersey.
“The numbers clearly show that many drivers who regularly commuted between states would fill their tanks up in New Jersey where they could pay anywhere from 8 to 28 cents less per gallon than either Pennsylvania or Delaware before the tax hike went into effect in November of 2016, but when that price advantage went away, drivers changed their gas buying habits accordingly,” said Tracy Noble, Public and Government Affairs Manager for AAA Mid-Atlantic.
As part of the 2016 gas tax hike package, New Jersey set up its own “lockbox” for its transportation fund, Pennsylvania does not yet have such a provision.
In October, the gas tax in New Jersey will rise another 4.3 cents per gallon, but AAA does not expect that increase to lead to significant changes in drivers’ gas buying habits.