Trump Backs Federal Gas Tax Suspension as Iran Conflict Pushes Prices to $4.52
AOL.com reported Monday that President Donald Trump has endorsed a temporary federal gas tax suspension, with Republican lawmakers in both chambers moving to draft legislation shortly after his public comments.
Trump told CBS News he considered the suspension “a great idea,” adding that the 18.4-cent-per-gallon levy would be lifted for an unspecified period and phased back in once prices decline. He did not name a price target or a fixed end date.
Prices Surge as Iran Blockade Tightens Supply
The national average for regular unleaded gasoline reached $4.52 per gallon on Monday, according to AAA data cited by AOL.com. That marks a rise of more than 50% since the United States entered conflict with Iran on February 28. Prices are up roughly $1.38 compared with the same period last year.
Iran’s continuing blockade of the Strait of Hormuz is widely blamed for the spike. The waterway handles approximately 20% of global oil and gas flows. Trump described the current ceasefire as being on “massive life support” after rejecting Tehran’s latest peace overture.
Legislation Introduced but Details Remain Thin
Republican Senator Josh Hawley of Missouri and Representative Anna Paulina Luna of Florida announced plans to introduce separate bills in their respective chambers. Luna said her office would coordinate directly with Trump’s team. Neither bill had been formally filed or assigned to a committee at the time of publication. No co-sponsors, bill text, or procedural timeline had been announced.
Suspending the tax would cost the federal government roughly $500 million per week, based on administration estimates. That revenue currently flows into the Highway Trust Fund, which covers road, bridge, and transit infrastructure across the country.
A Familiar Debate with Serious Fiscal Warnings
Also Read: Oil Prices and the Strait of Hormuz: What Investors Need to Know
The gas tax suspension debate is not new. Democratic lawmakers had already introduced their own suspension bill in March, proposing relief through October. Canada suspended its comparable federal fuel levy in April at an estimated cost of $1.74 billion.
Fiscal watchdogs remain skeptical. The nonpartisan Committee for a Responsible Federal Budget warned earlier this year that a suspension would accelerate the Highway Trust Fund’s insolvency. It also noted the 18.4-cent relief would not offset even half of last month’s price increase alone.
Trump suggested the Iran situation remains the core variable, saying pump prices would fall sharply once the conflict is resolved. No mechanism for monitoring that trigger exists in either proposed bill.
Also Read: AAA National Gas Price Tracker
Read Next: What the Iran Strait of Hormuz Blockade Means for Global Energy Markets
