Trump Eyes Federal Gas Tax Pause as Iran War Drives Fuel Costs to Four-Year High
Donald Trump has pledged to suspend the federal gas tax as the US-Israel conflict with Iran drives fuel prices to their highest levels in four years, The Guardian reported Monday. The president told reporters he wants to pause the levy until conditions improve for American drivers.
Trump Signals Relief at the Pump
Speaking to CBS News, Trump called the gas tax suspension “a great idea.” He indicated the pause would remain in place until market prices ease, at which point the tax would gradually return. He later repeated the commitment during public remarks at the White House. Trump acknowledged the tax itself covers only a fraction of the overall price jump but argued relief at any level matters for struggling households.
The federal gas tax currently stands at 18.4 cents per gallon for regular gasoline and 24.4 cents for diesel. The levy generates roughly $500 million per week for federal infrastructure funding, making any suspension a significant budgetary decision that requires an act of Congress.
Also Read: Oil Majors Post Record Quarterly Profits as Iran Conflict Lifts Crude
Prices Surge Past $4.50 Nationwide
The national average for a gallon of gasoline reached $4.52 on Monday, according to AAA data cited by The Guardian. That figure is up sharply from $3.14 per gallon recorded one year earlier. Prices have climbed continuously since US and Israeli forces launched military operations against Iran roughly two months ago.
The surge lands in the middle of a broader affordability squeeze. Fuel costs rank among voters’ top concerns heading into this year’s midterm elections. Many Americans say rising pump prices are forcing cutbacks on essential spending.
Background: A Tax Unchanged for Decades
Congress last adjusted the federal gas tax in 1993, fixing it at its current rate. Prior attempts to suspend the levy during price spikes have stalled in Washington, partly because of the funding it provides for highway maintenance and bridge repairs. Economists have historically cautioned that tax holidays can be quickly absorbed by producers rather than passed on to consumers.
Republican Lawmakers Move Quickly
Congressional Republicans moved fast after Trump’s comments. Senator Josh Hawley of Missouri announced he would introduce suspension legislation in the Senate. Representative Anna Paulina Luna of Texas said she would file a companion bill in the House, citing the need to deliver direct relief to families. Analysts note that top oil and gas companies have posted outsized profits since the Iran conflict began, adding political pressure to act.
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