Biden administration pushes for gas tax pause

The federal tax on gasoline has not changed since 1993. Photo: Willard/iStock / Getty Images Plus/Getty Images

As gas prices continue to climb nationwide, the Biden administration looks to a potential federal gas tax pause to alleviate some pain at the pump.

Biden calls on Congress to suspend the federal gas tax for three months through September. He says the move would not take any money away from the Highway Trust Fund, which is funded by the federal tax and goes toward highway and public transportation projects.

Currently, the federal gas tax sits at 18 cents per gallon of gasoline and 24 cents per gallon of diesel. Biden also calls on states to take similar action by suspending their gas taxes or helping consumers in other ways.

“With our deficit already down by a historic $1.6 trillion this year, the President believes that we can afford to suspend the gas tax to help consumers while using other revenues to make the Highway Trust Fund whole for the roughly $10 billion cost,” the White House says. “This is consistent with legislation proposed in the Senate and the House to advance a responsible gas tax holiday.”

In February, Sens. Mark Kelly (D-Arizona) and Maggie Hassan (D-New Hampshire) introduced the Gas Prices Relief Act, which aimed to suspend the gas tax for the rest of the year. The bill has yet to be voted on by the Senate.

“President Biden understands that a gas tax holiday alone will not, on its own, relieve the run-up in costs that we’ve seen,” the White House adds. “But the president believes that at this unique moment when the war in Ukraine is imposing costs on American families, Congress should do what it can to provide working families breathing room.”

Some states have taken similar steps to reduce costs. Connecticut and New York temporarily suspended their gas taxes, and Illinois and Colorado delayed planned tax and fee increases. State gas taxes range from 14.98 cents per gallon to 66.98 cents per gallon, on top of the 18 cents per gallon federally.

According to the White House, in states like Michigan and Minnesota, state and local leaders are considering a number of options, including temporary suspensions and pauses on state gas taxes and consumer rebates and relief payments.

Mike Johnson, president and CEO of the National Stone, Sand & Gravel Association (NSSGA) spoke out against the proposed gas tax pause.

“On the heels of receiving the largest package for infrastructure funding in the nation’s history, the Biden administration has asked Congress to suspend the gas tax,” Johnson says. “Suspending the federal gas tax will upend the historic investments just put into law and jeopardize our surface transportation programs that are in desperate need of updates and modernization. Repeated studies show a gas tax holiday is a shortsighted fix and will not help in alleviating higher prices paid by consumers.

“NSSGA shares the views of many leaders on both sides of the aisle in Congress that this proposed tax holiday will not put money back in the hands of the consumer and will harm the economy,” Johnson adds. “In fact, suspending the gas tax will only drive uncertainty and harm American families that have been waiting for decades for new investments to improve their roads, bridges and communities. NSSGA instead calls on Congress and the administration to take up common-sense solutions that will increase American energy supply. NSSGA will keep fighting in Washington and working with our partners across every state to oppose federal or states seeking to halt or suspend the current gas tax.”