Donald Trump told CBS News in a Monday-morning phone interview that he intends to suspend the federal gasoline tax "for a period of time" to ease pump prices that have climbed past $4.50 a gallon since the start of the Iran war. The 18.4-cent-per-gallon levy on gasoline and 24.4-cent-per-gallon tax on diesel both feed the Highway Trust Fund, the federal account that finances interstate-road and bridge repair.
Energy Secretary Chris Wright told Fox News on Sunday evening that the administration was "open to" the move and that the president was "weighing options". The CBS interview, recorded shortly after 7am Eastern on Monday, was the first time Trump committed publicly to the proposal. Senator Josh Hawley, Republican of Missouri, said he would introduce a Senate bill this week; Representative Anna Paulina Luna of Florida announced a parallel House bill.
The legal mechanics make the move harder than the politics. A federal-tax suspension requires congressional approval, which has not happened in any prior pump-price surge — including the 2008 Obama-McCain campaign-trail proposal that died on the Senate floor. The Trust Fund relies on the gas and diesel taxes for roughly 80 per cent of its revenue; suspension would cost the federal government about $26 billion over six months according to Penn Wharton.
The pass-through to drivers is less than headline numbers suggest. A Penn Wharton Budget Model analysis released on Monday estimated that a full suspension would cut prices at the pump by roughly 13.2 cents per gallon on gasoline and 14.6 cents on diesel, smaller than the levy because oil companies typically capture part of the cut. A household filling a 15-gallon tank weekly between June and October would save about $35 in total.
House Democrats have indicated they will block the suspension unless it is paired with offsetting revenue. Speaker Hakeem Jeffries — who has been a frequent Trump critic on energy policy — said in a Monday statement that a tax cut "with no replacement for road and bridge funding is not a serious answer to the price of gas". Senator Joe Manchin's successor in West Virginia, Republican Jim Justice, said he would push for a suspension paired with accelerated permitting of LNG export facilities.
In oil markets the proposal has been received as politically useful rather than economically meaningful. Brent crude held above $107 on Tuesday despite the news, with analysts pointing out that the underlying constraint — the Strait of Hormuz blockade — is unchanged. AAA, in a Monday national bulletin, said the average US retail gasoline price had climbed to $4.52 a gallon, the highest level since the summer of 2022.
The political pressure is acute. Federal Reserve modelling cited in last week's House Financial Services hearing suggested that gas-pump prices alone account for roughly half of the eight-percentage-point swing in Trump's job-approval rating since February. The administration is also weighing further releases from the Strategic Petroleum Reserve and reciprocal-tariff exemptions for crude from non-Iranian Gulf suppliers.