That’s how much less a gallon of gas could cost if a federal gas tax holiday were enacted—something the Biden administration says it’s considering.
On Monday, President Joe Biden told reporters that he’s considering a pause on the 18.4 cent federal gas tax, and hopes to make a decision on the matter by the end of the week. His comments came as high prices for crude oil and a reduced capacity to refine oil into gasoline have kept gas prices elevated recently. Prices peaked at a record nationwide average of $5.01 per gallon last week before slipping to $4.98 on Monday, according to AAA.
Democrats in Congress have already introduced legislation to enact a federal gas tax holiday through the end of the year, but so far neither the Senate nor the House bills have drawn support from Republicans. The move to drop gas taxes is one that a handful of states—including Maryland, Georgia, Connecticut, New York, and Florida—have already tried at the state level this year.
While a federal gas tax holiday would likely result in some savings for drivers, it would also directly impact highway funding through lost tax revenue, critics say. In addition, lower gas prices could result in increased demand for gas, which could further push up prices, the Tax Foundation said in a February post.
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