President Joe Biden said Monday he is considering a federal gas tax holiday as the administration looks for ways to spare the public from rising prices at the pump, which have started to climb the last year and surged after Russia invaded Ukraine in February.
“Yeah, I’m thinking about it,” Biden told reporters after strolling along the beach. “I hope to have a decision based on the data – I’m looking by the end of the week.”
Nationwide gas prices average just under $5 a gallon, according to AAA. The move would save US consumers up to 18.4 cents per gallon.
The Biden administration has already released oil from the U.S. strategic reserve and increased ethanol blending for the summer, in addition to sending a letter last week to oil refiners urging them to increase refining capacity. Yet those efforts have yet to significantly reduce pricing pressures, so the administration is now considering a gasoline tax exemption. Gasoline and diesel fuel taxes help pay for highways.
Penn Wharton’s budget model released estimates on Wednesday showing consumers saved at the pump due to gasoline tax holidays in Connecticut, Georgia and Maryland. The majority of savings went to consumers, rather than gas stations and others in the energy sector.
In an interview on ABC’s “This Week” Sunday, Treasury Secretary Janet Yellen expressed her openness to a federal gas tax holiday to provide relief to motorists.
“It’s an idea that’s definitely worth considering,” Yellen said. She added that President Biden wants to “do whatever he can to help consumers.”
Worried about gas prices? Here are tips on how to improve your gas mileage when you’re on the road.