Trump Considers Suspending Federal Gas Tax

President Trump announced Tuesday that he is considering suspending the federal gas tax, a proposal that comes as several states have already implemented similar measures to reduce fuel costs.

The federal gas tax, which contributes 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel, is a primary funding source for highway and bridge maintenance. However, implementing a suspension would necessitate action from Congress, which is not scheduled to reconvene until after the midterm elections.

"We're thinking about that," Trump told reporters at the White House, acknowledging the potential for federal action.

This consideration follows a series of efforts by the administration to address rising energy prices, which have been a significant contributor to inflation. Earlier in the week, Trump signed an executive order allowing truckers to purchase tax-free "red dye" diesel fuel through December 31. This type of diesel is typically used for agricultural and construction equipment but can now be utilized more broadly.

Internationally, the G7 nations, including the United States, the United Kingdom, France, Germany, Italy, Canada, and Japan, collectively agreed to release 100 million barrels of oil and diesel from strategic reserves. This coordinated release aims to help stabilize and reduce fuel prices.

State-Level Actions on Gas Taxes

The average price for diesel fuel in the U.S. has reached $6.32 per gallon, according to AAA data. While this is a decrease from its peak of $6.53 on September 22, it remains nearly double the $3.68 average recorded a year prior. Gasoline prices have also seen a significant increase, currently averaging $4.37 per gallon, up from $3.13 last year.

In response to these rising costs, both Republican and Democratic-led states have taken steps to provide relief. Several states have enacted temporary waivers of their state gas taxes or eased restrictions on fuel purchases.

In Ohio, Republican Governor Mike DeWine signed legislation suspending the state's 38.5-cent gas tax and 47-cent diesel tax through December 31. Utah Republican Governor Spencer Cox reduced his state's fuel levies by 6 cents per gallon for the remainder of the year. Georgia Republican Governor Brian Kemp suspended the state's 33.3-cent gas tax and 37.3-cent diesel tax until at least October 29. Indiana Republican Governor Mike Braun suspended a 7% gasoline use tax and a 37-cent excise tax, resulting in savings of approximately 59 to 61 cents per gallon for gasoline, while keeping a 63-cent per gallon diesel tax in place and expanding "red dye" diesel availability. Kentucky Democratic Governor Andy Beshear paused automatic adjustments to state fuel taxes that would have increased rates due to inflation.