President Trump says he supports a temporary federal gas tax holiday as gasoline and diesel prices climb amid the war in Iran.
The idea could bring drivers some short-term relief at the pump. But it is already drawing skepticism from lawmakers who argue it would do little to address the larger forces driving fuel prices higher.
Trump told CBS News last week that suspending the federal gas tax is "a great idea," saying his administration wants to "take off the gas tax for a period of time" and restore it once prices come down. Energy Secretary Chris Wright has also backed the proposal.
Any federal gas tax holiday would still require congressional approval. According to The Hill, the federal levy now stands at 18.4 cents a gallon for gasoline and 24.4 cents a gallon for diesel. A pause could theoretically save regular drivers some money if gas companies pass the full cut on to consumers.
However, because the gas tax isn't collected at the pump, but at the refinery, it isn't guaranteed that these savings would be passed on to consumers.
Lawmakers in both parties have already introduced legislation to get the ball rolling. Democratic Sens. Richard Blumenthal of Connecticut and Mark Kelly of Arizona proposed a suspension through Oct. 1, 2026. Republican Sen. Josh Hawley of Missouri also introduced a 90-day version after President Trump endorsed the idea.
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Not everyone supports the move. Notably, Senate Majority Leader John Thune said that reopening the Strait of Hormuz would be a far more effective way to stabilize prices. He also warned that suspending the tax could undermine the Highway Trust Fund, which helps pay for roads and bridges.
State gas taxes can add much more to the total cost depending on where drivers live. They range from 8.95 cents per gallon in Alaska to 70.92 cents in California, according to the U.S. Energy Information Administration. While these two states represent the extremes in state gas taxes, a large majority fall between the 20 and 50 cents per gallon rate.
For many households, even a savings of a few cents per gallon can matter when commuting, transporting goods, or stretching a tight budget. At the same time, the debate over whether to pause gas taxes points to a broader problem: U.S. families remain vulnerable to sudden price spikes because transportation is so heavily tied to oil.
International conflict, shipping disruptions, and military action can quickly reach neighborhood gas stations and household budgets.
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