President Donald Trump announced on Monday that he will suspend the United States federal tax on gasoline, a move aimed at easing the financial burden on American consumers as fuel prices continue to surge in the wake of the ongoing US-Iran war. Speaking to CBS News, Trump said, "We're going to take off the gas tax for a period of time, and when gas goes down, we'll let it phase back in," adding later that the suspension would last "till it's appropriate." The average national price of regular gasoline now stands at $4.52 per gallon — roughly 50% higher than the approximately $3 per gallon recorded before US and Israeli strikes on Iran began on 28 February.
The federal gasoline tax is currently set at 18.4 cents per gallon, with a separate rate of 24.4 cents per gallon applying to diesel. It is the single largest source of funding for federal highway and public transit programmes, generating more than $23 billion annually. However, Trump does not have the authority to suspend the tax unilaterally — doing so requires an act of Congress. Senator Josh Hawley, a Republican from Missouri, announced he would introduce legislation to that effect on Monday, and Representative Anna Paulina Luna of Florida said she would file a companion bill in the House. Democrats have also previously sponsored similar measures, including a Senate bill from Senators Richard Blumenthal of Connecticut and Mark Kelly of Arizona that would suspend the tax through 1 October. Energy Secretary Chris Wright had signalled the administration's openness to the idea a day earlier, saying the White House was considering all options.
The administration has already taken other steps to contain fuel costs, including releasing oil from the US Strategic Petroleum Reserve and temporarily lifting sanctions on some Russian and Iranian oil shipments at sea. Several states have independently acted to reduce the burden at the pump: Indiana, Georgia and Kentucky have suspended or reduced their own state gas taxes, with other states weighing similar measures. Analyst Rachel Ziemba of the Center for a New American Security noted that the combined effect of federal and state tax cuts could create significant regional price variation, and suggested the move signals the White House does not expect a quick resolution to the supply disruptions.
The proposal is not without critics. The American Road and Transportation Builders Association, which represents the transportation construction industry, warns that suspending the tax — even if lost revenue is offset by general funds — could raise the federal deficit and undermine long-term investment in infrastructure. Research also indicates that retailers do not always pass the full value of such tax cuts on to consumers, meaning the relief at the pump may be smaller than advertised. Oil markets remain volatile: Brent crude futures climbed above $104 a barrel on Monday, driven in part by uncertainty over the fragile US-Iran ceasefire, which Trump described as being on "life support." The turbulence has hit the airline industry hard as well, with budget carrier Spirit Airlines ceasing operations after 34 years, citing "a massive and sustained increase in fuel prices" linked to the conflict, while United Airlines has raised fares by 20%.