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Energy Secretary Wright Signals Trump Support for Federal Gas Tax Holiday

Energy Secretary Wright Signals Trump Support for Federal Gas Tax Holiday
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Energy Secretary Chris Wright said the Trump administration was “open to all ideas” to bring down fuel costs — including suspending the 18.4‑cent‑per‑gallon federal gas tax — as the national average price of gasoline climbed to about $4.52 a gallon over the weekend, more than 50% higher since the start of the Iran war.foxnews +1 Any pause, however, would require an act of Congress and could blow a multibillion‑dollar hole in highway funding.usatoday +1

Speaking on NBC’s “Meet the Press” on May 10, Wright said the White House backed “all measures that can be taken to lower the price at the pump,” while cautioning that “everything has trade‑offs.”foxnews +1 His comments marked the first clear signal that President Donald Trump might support a federal gas tax holiday, an idea long resisted by fiscal hawks but embraced this spring by some Democrats and a handful of Republicans as prices spiked amid conflict with Iran.nypost +1

What a Federal Gas Tax Holiday Would Actually Do

The federal gasoline tax, unchanged since 1993, adds 18.4 cents to each gallon of regular fuel and about 24 cents to diesel, money that flows into the Highway Trust Fund to pay for roads, bridges and transit.nypost Independent estimates suggest suspending the levy would reduce federal revenues by roughly $2.4 billion per month, forcing Congress either to backfill that money from general funds or cut infrastructure spending.usaherald

For drivers, the savings would be modest. If fully passed through, a typical motorist using 50 gallons a month would save about $9.20 — but real‑world experience shows companies often keep part of the benefit. A Penn Wharton analysis of state gas tax holidays in 2022 found that only 58% to 87% of the tax cuts showed up at the pump, depending on the state and timing.artthreat The Institute on Taxation and Economic Policy estimated that households earning under $53,000 a year would save an average of just $5 per month from a federal holiday, while the Highway Trust Fund would still lose billions.usaherald

Politics, Precedent and Skepticism in Washington and the States

The prospect of a federal pause landed in a Congress already fighting over competing proposals. Democrats including Sens. Mark Kelly and Richard Blumenthal and Rep. Chris Pappas introduced the Gas Prices Relief Act in March to suspend the tax through October 2026, arguing it would offer immediate relief as war‑related supply disruptions pushed national fuel prices sharply higher.nbsla +1 Some Republicans, such as Sen. Josh Hawley, backed a similar suspension, but GOP leaders have been cooler; Sen. Shelley Moore Capito said she did not think the effects “would be strong enough to merit” the revenue loss.yoursourceone

Governors’ recent experience with state gas tax holidays also weighed heavily. During the last major oil shock in 2022, states like Maryland, Georgia and Connecticut temporarily cut their fuel taxes, only to see partial, short‑lived price relief.artthreat +1 This year, Georgia again suspended its gas tax, while Indiana paused sales and excise taxes on gasoline, but other governors — including Florida’s Ron DeSantis and New York’s Kathy Hochul — publicly rejected new holidays, arguing consumers “don’t really feel” the savings once global oil prices move.yoursourceone

The Bigger Picture

Any federal gas tax suspension would offer visible but limited relief against a surge driven mainly by war‑related supply shocks, with economists warning that modest per‑driver savings could come at the cost of delayed infrastructure projects and weakened transit systems.nypost +1 Wright’s comments nonetheless underscored how political pressure from $4.50‑plus gasoline is pushing the White House and Congress toward short‑term fixes, even as analysts say the more decisive levers — easing the conflict with Iran and restoring stable oil flows — lie far beyond the gas pump.