Joe Biden's Call to Pause Gas Tax for 3 Months Is Met with Skepticism in Congress
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im LoScalzo/EPA/Bloomberg via Getty Joe Biden
President Joe Biden on Wednesday called on Congress to put a three-month pause on federal gasoline and diesel taxes, a move that's meant to ease the pain of rising gas prices heading into the busy summer travel season.
In a fact sheet, the White House noted that gas prices are up "dramatically around the world, and by almost $2 per gallon in America, since Putin began amassing troops on the border of Ukraine."
The White House added that Biden is now "calling on Congress to suspend the federal gas tax for three months, through September, without taking any money away from the Highway Trust Fund. And he is calling on states to take similar action to provide some direct relief, whether suspending their own gas taxes or helping consumers in other ways."
The federal government currently charges a tax of 18 cents per gallon of gasoline and 24 cents per gallon of diesel. "Those taxes fund critical highways and public transportation, through the Highway Trust Fund," the White House said. "But in this unique moment, with gas prices near $5 a gallon on average across the country, President Biden is calling on Congress to suspend the gas tax for three months — until the end of September — to give Americans a little extra breathing room as they deal with the effects of Putin's war in Ukraine."
But "extra breathing room" may not be enough to convince lawmakers, with Republicans widely opposing the measure.
Some Democrats are also opposed to lifting the gas tax temporarily, with moderate Democrat Sen. Joe Manchin telling CNN this week he's "a little skeptical" of the idea, which he says offers "no guarantee" of a reduction in gas prices.
Those opposed say the savings could be pocketed by oil companies rather than passed to the consumers themselves. Former President Barack Obama has called gas tax holidays "a gimmick" in the past, while Sen. Bernie Sanders wrote on Twitter in March that a gas tax holiday is "a bad idea today."
The White House has taken action in recent months to alleviate prices at the pump by boosting supply, including by a historic release from the Strategic Petroleum Reserve and expanded access to biofuels. So far, though, prices at the pump have remained high, contributing to record-high inflation and forcing the Federal Reserve to raise interest rates amid fears of a looming recession.
An economist at Moody's Analytics told CNN this week that a gas tax holiday could worsen the problem and lead to further inflation (and, as a result, lead the Fed to raise rates even more aggressively).
