Everything You Need To Know About Biden’s Gas Tax Holiday
President Joe Biden has asked Congress to suspend the federal gas tax for three months in an effort to relieve high gasoline prices.
What is a Gas Tax Holiday?
A tax holiday is a temporary relief for certain taxes. In this case, the holiday would put a temporary pause on federal gas taxes. In certain situations, these holidays can come from the federal government, state government, or both.
What is being proposed?
The taxes collected from gasoline help fund the Highway Trust Fund. Federal gas taxes rate for gasoline is 18 cents per gallon and 24 cents per gallon for diesel fuel, which Biden is proposing to put a pause on for three months.
“I fully understand that a gas tax holiday alone is not going to fix the problem, but it will provide families some immediate relief, just a little bit of breathing room as we continue working to bring down prices for the long haul,” Biden said.
Who is against it?
Many trucking organizations are against this holiday since it would deplete the already underfunded highway account.
The money collected from the federal tax rate goes directly to the HTF to build infrastructure. If this tax holiday were to take effect the trust fund would find itself with a $10 billion shortfall.
Biden is also asking Congress to divert funds from other sources to the HTF to mitigate this shortfall.
CEO of the American Trucking Association, Chris Spear gives three alternatives to President Biden’s proposal.
“Make America energy independent… stop kissing the ring of Saudi Arabia. Renew trade agreements with the European Union and Asian Pacific nations in order to export more American oil and natural gas. And, balance the budget… stop wasting hard-earned taxpayer dollars on senseless programs that drive up inflation and runaway deficits.”
If passed, we could see gasoline and diesel prices drop by 18.4 cents per gallon, which for a 15-gallon car, would save you about $2.76.
“A federal or state gas tax holiday would starve the Highway Trust Fund of much-needed financing,” said Jim Ward, CEO of Truckload Carriers Association.
On June 23, members of the oil industry are meeting with the United States Department of Energy secretary, Jennifer Granholm.
The members of the oil industry include; Exxon, Mobil, Chevron, Shell, Marathon, and Phillips 66.
The energy department claims that the President of Russia, Vladimir Putin, is using energy as a weapon and our oil companies need to deliver a mitigation plan to ensure the general public does not suffer the consequences.
Some state officials are also against the idea of this federal tax holiday.
Kentucky Attorney General Daniel Cameron has accused Biden of pushing an “extreme ‘green’ agenda.”
Kentucky has declared a state of emergency for gasoline, which forces gasoline companies to stop price gouging.
The attorney general has urged Kentucky citizens to report any cases of price gouging to their office.
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