Biden Calls for Three-Month Federal Gas Tax “Holiday”

By CBS News
Posted on 06/22/22 | News Source: CBS News

President Joe Biden called on Congress Wednesday to suspend federal gasoline and diesel taxes for three months — a move meant to ease financial pressures at the pump that also reveals the political toxicity of high gas prices in an election year, CBS reports. The president is also calling on states to suspend their own gas taxes or provide similar relief, the White House said.

In announcing the move, the White House said, “The price of gas is up dramatically around the world, and by almost $2 per gallon in America, since (Russian President Vladimir) Putin began amassing troops on the border of Ukraine.”

At issue is the 18.4 cents-a-gallon federal tax on gas and the 24.4 cents-a-gallon federal tax on diesel fuel. If the gas savings were fully passed along to consumers, people would save roughly 3.6% at the pump with prices averaging about $5 a gallon nationwide.

But many economists and lawmakers from both parties view the idea of a gas tax holiday with skepticism.

Barack Obama, during the 2008 presidential campaign, called the idea a “gimmick” that allowed politicians to “say that they did something.” He also warned that oil companies could offset the tax relief by increasing their prices.