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Trump Backs Federal Gas Tax Holiday as Congress Weighs Cost and Impact

Economists say the plan would offer only modest, temporary savings given a supply shock from the Iran war.

Overview

  • President Trump, who said Monday he wants to pause the federal gas tax, spurred a 90‑day bill from Sen. Josh Hawley and a forthcoming House bill from Rep. Anna Paulina Luna.
  • A pause cannot happen without Congress, and leaders such as Sen. John Thune and Sen. John Cornyn questioned whether savings would reach drivers and how to protect the Highway Trust Fund.
  • Experts say only part of the 18.4‑cent levy would show up at the pump, with Penn Wharton estimating about 13 cents on average and roughly $35 in savings over four months for a weekly 15‑gallon fill‑up.
  • Budget groups project large revenue losses for road and transit programs, including about $8.35 billion over four months and roughly $3.5 billion per month by one estimate, which could force backfills or delay projects.
  • Gas averages about $4.50 per gallon, driven by tanker disruptions at the Strait of Hormuz, and several states including Georgia, Indiana, Kentucky and Utah have moved to cut or suspend their own fuel taxes.