Will New Jersey's Gas Tax Rise Again in January?

New Jersey fiscal officials will review the Transportation Trust Fund's balance by Sunday, Nov. 15, to decide whether to raise the gasoline and diesel taxes. If they conclude an increase is needed, it will take effect Jan. 1 of next year. NJ Spotlight News reported that the review comes as fuel prices have climbed in the wake of the Iran war.

According to NJ Spotlight News, state law requires New Jersey fiscal officials to check by Sunday, Nov. 15, whether the Transportation Trust Fund (TTF), which pays for transportation infrastructure projects, is balanced at the current tax rates. If they judge the revenue shortfall to be large, the higher rates will apply starting Jan. 1 of next year. The current rates are 49.1 cents per gallon of gasoline and 56.1 cents per gallon of diesel.

According to AAA New Jersey, the average price of gasoline in New Jersey is $4.10 per gallon, up since the Iran war began. Diesel jumped from $3.66 to $6.33 in one year. Last year, gasoline was under $3 per gallon, and officials at the time decided on a 4.2-cent increase to take effect this year. A spokesperson for the state Treasury Department declined to comment on this year's decision on Thursday, Nov. 5. Under past practice, any change in the rate is announced by early December.

New Jersey's gasoline tax is the main source of revenue for the Transportation Trust Fund. The fund, which is separate from the state budget, spends billions of dollars each year on road, bridge and rail projects. A law revised in 2024 made it more likely that small increases will be needed every year, and moved the review deadline from Aug. 15 to Nov. 15 and the effective date of any increase from Oct. 1 to Jan. 1. The tax is levied not as a percentage of the price but on the amount of fuel purchased, and it rose by 2.6 cents in 2025. The Tax Foundation said New Jersey's per-gallon rate, including this year's increase, is the seventh highest in the nation.

Drivers who fill up at New Jersey gas stations pay the same state tax per gallon regardless of that day's price. The federal tax is added on top of that, and the federal rates, 18.3 cents per gallon of gasoline and 24.3 cents for diesel, have not changed since 1993. If an increase is approved, the state tax will go up for fuel purchased starting Jan. 1 of next year.