With driving and gas demand both slowing down this winter — and with supply increasing — drivers in New Jersey and across the U.S are seeing some of the lowest gas prices in years.

But that may change soon — at least in New Jersey — thanks to a looming 4.2 cent per gallon gas tax increase starting on Jan. 1, 2026.

The increase is based on an annual adjustment that pays for transportation projects, the state Treasury Department announced on Dec. 1. New Jersey's gas tax is already 49.1 cents per gallon for gasoline and 56.1 cents per gallon for diesel fuel.

This new increase is "because actual consumption has trended below last fiscal year's levels," said New Jersey State Treasurer Elizabeth Maher Muoio. Higher consumption means a lower gas tax, and vice versa.

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