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Trump Wants to Suspend the Federal Gas Tax as Prices Soar

The suspension of a federal gas tax might bring relief at the pump.

By Chris Lewis, CEPF , Edited by Becca Borawski Jenkins

Updated Nov. 10, 2026

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As gas prices continue to increase, you might be trying to cut back on driving so you can keep more of what you earn. You're not alone; Americans are feeling the strain of higher gas prices heading into the summer.

President Trump has announced he wants to suspend the federal gas tax, a temporary move that might help give Americans some relief from the soaring prices at the pump.

Here's what you should know about how that might work and whether it will make a difference for your wallet.

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Why gas prices are surging

Since the Iran war began on February 28, gas prices have increased by over 50%. According to AAA, as of Tuesday, May 12, a gallon of gasoline costs an average of $4.50, which is up from $4.12 a month ago. A year ago, a gallon of gas averaged $3.14.

According to the International Energy Agency, the Strait of Hormuz, a passage that separates the Arabian Peninsula and Iran, is one of the world's most critical oil transit chokepoints. In 2025, an average of 20 million barrels of crude oil and oil products were shipped through the Strait of Hormuz per day. As Iran blocks access to the Strait of Hormuz, oil prices and gas prices continue to climb.

Increased gas prices are affecting other costs, too. Rising fuel costs may increase the price of groceries and other goods, further straining consumers' budgets.

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Understanding the federal gas tax

The federal gas tax is currently 18.4 cents per gallon on gasoline and 24.4 cents per gallon on diesel. That's in addition to state gas taxes, which are often higher than the federal taxes. Bill Clinton last increased the federal gas tax in 1993.

That gas tax is the largest single revenue source feeding federal highway and public transit programs, including funding the Highway Trust Fund, which is responsible for building and repairing roads.

What states are doing

Some states have already taken steps to reduce or temporarily suspend their gas tax to provide relief to consumers. Indiana and Georgia both temporarily suspended their state gas taxes to help bring prices down. Kentucky and Utah have also temporarily reduced their state gas taxes.

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Legislation intended to suspend the federal gas tax

After Trump's comments about his plans to suspend the federal gas tax, several other politicians spoke out in support. Republican Senator Josh Hawley stated that he would introduce legislation to suspend the tax, while GOP Representative Anna Paulina Luna stated that she plans to introduce a House bill to suspend the tax.

Democrats also proposed legislation in March to suspend the gas tax, which stalled.

Steps needed to suspend the federal gas tax

Trump alone can't suspend the federal gas tax. Congress would have to approve the decision, and introducing House and Senate bills would be the first step toward that decision.

Both Republican and Democratic lawmakers have expressed support for a tax suspension to help lower prices and give families financial relief. However, the proposed move has also drawn criticism, including concerns about the resulting lack of revenue for the Highway Trust Fund. Republican Senator Rand Paul stated that instead of suspending the gas tax, America should suspend the war.

What the bill proposes

Hawley's bill, released Monday, moves to suspend the gasoline and diesel tax for 90 days. If passed, the bill would give Trump the ability to extend the gas tax suspension for an additional 90 days if needed.

According to the Bipartisan Policy Center, suspending the gas tax for five months could cost billions in revenue for the Highway Trust Fund, but the proposed bills are designed to offset lost revenue with general funds.

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How much Americans might save at the pump

Even if the federal gas tax were suspended, consumers might not see the full benefit of that relief. The Bipartisan Policy Center estimates that gas might fall by 10 to 16 cents per gallon for consumers, but gasoline suppliers would likely net the rest of the benefit.

While saving money on gas sounds like a welcome shift currently, suspending the federal gas tax would result in relatively small savings for consumers. If the Strait of Hormuz remains closed and gas prices continue to rise, consumers might barely notice those savings from the tax suspension.

Bottom line

If the federal gas suspension passes, it might help slightly reduce gas prices, but it doesn't address the root cause of the problem. Real relief of rising gas costs hinges on resolving the Iran war and reopening the Strait of Hormuz.

According to the Congressional Research Service, a prolonged oil trade disruption could create market conditions with no historical precedent, meaning we might see more pain at the pump unless the war is resolved.

It's worth following the legislation to see if it passes, as any savings at the pump, even small, may help eliminate some money stress during this challenging time.

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