A Holiday From the Federal Gas Tax? Not So Fast | U.S. News Decision Points

President Donald Trump opposed the idea of suspending federal gasoline taxes as recently as March. But with the average price at the pump now over $4.50 per galloninflation on the rise and amid widespread disapproval of his handling of the economy, he has come around. That doesn’t mean you’ll get a break.

On Monday, Trump said he favored a pause “until it’s appropriate.” He went on to say that while the tax is “a small percentage” of the overall price, “it’s still money.” The federal government collects 18.4 cents per gallon on gasoline and 24.4 cents per gallon on diesel.

He was more effusive in a Monday interview with CBSsaying freezing the federal gas tax was “a great idea.”

“We’re going to take off the gas tax for a period of time, and when gas goes down, we’ll let it phase back in,” he said.

Here’s why you shouldn’t get your hopes up.

The first thing to understand is that the president cannot unilaterally suspend the tax. That requires an act of Congress. And lawmakers seem divided on the issue – including at the leadership level.

On Monday, Senate Republican Majority Leader John Thune said he had not “been a fan” of a gas tax suspension in the past but added, “I’ve got some colleagues out there who think it’s a good idea. So, we’ll hear them out.’’

On Tuesday, House Republican Majority Leader Steve Scalise declined to commit to bringing legislation suspending the tax up for a vote, according to Politico.

“I mean, obviously we all want to see gas prices come back down,” Scalise said. “And when the Iran conflict is resolved, they will, and they’ll come down quickly. I don’t think anybody disputes that. You’re seeing the president work really hard to try to get this (war) resolved, and you know, we’ll see when that happens. Hopefully it’s soon.”

Legislation suspending the tax has been kicking around at least since March, when Democratic

Sens. Mark Kelly of Arizona and Richard Blumenthal of Connecticut introduced legislation to suspend the federal gas tax through Oct. 1. On Monday, Sen. Josh Hawley, a Republican from Missouri, introduced a GOP version that would freeze the duty for 90 days and allow Trump to extend that for another 90 days.

There are proposals from both parties in the House, as well.

“This should have happened months ago,” Rep. Chris Pappas, a Democrat from New Hampshire, said on social media. Pappas has authored legislation suspending the tax.

The idea has created curious political bedfellows. Senate Democratic candidate James Talarico in Texas immediately applauded Trump for embracing the notion. Sen. John Cornyn, a Republican who could face Talarico in November, has dropped his opposition to the idea.

It’s a flashy, populist idea that could let politicians tell voters that they are tackling cost-of-living issues – a seductive possibility not quite six months before the midterm elections.

The simplest answer is that suspending the tax will dig a hole in the Highway Trust Fund, which manages investments in the nation’s mass transit and highway systems, while not delivering much relief to the average taxpayer.

The Bipartisan Policy Center, a Washington think tank, estimates that gas prices would drop by 10 to 16 cents per gallon for consumers, while fuel suppliers would get the rest of the benefit.

Meanwhile, a holiday would reduce gas tax revenue by about $17 billion, which amounts to 46% of total projected fiscal year 2026 gas and diesel tax revenue to the Highway Trust Fund, according to the Bipartisan Policy Center.

That’s one of the reasons Congress rejected President Joe Biden’s entreaties to suspend the gas tax back in 2022, when prices at the pump soared because of Russia’s expanded invasion of Ukraine.

And back in 2008, Sen. Barack Obama derided proposals to suspend the tax while on the presidential campaign trail.

“We’re arguing over a gimmick that would save you half a tank of gas over the course of the entire summer so that everyone in Washington can pat themselves on the back and say that they did something,” he said. “This isn’t an idea designed to get you through the summer, it’s designed to get them through an election.”

In the current political climate, though, that half a tank of summer savings might be one of the few bipartisan ideas in Washington. Even if some are pumping the brakes.