President Joe Biden said Monday that he's considering a federal holiday on the gasoline tax, as the administration looks for ways to spare the public from higher prices at the pump, which began to climb last year and surged after Russia invaded Ukraine in February.
“Yes, I’m considering it,” Biden told reporters after taking a walk along the beach. “I hope to have a decision based on the data — I’m looking for by the end of the week.”
Gas prices nationwide are averaging just under $5 a gallon, according to AAA. The move would save U.S. consumers as much as 18.4 cents a gallon.
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The Biden administration has already released oil from the U.S. strategic reserve and increased ethanol blending for the summer, in additional to sending a letter last week to oil refiners urging them to increase their refining capacity. Yet those efforts have yet to reduce price pressures meaningfully, such that the administration is now considering a gas tax holiday. Taxes on gasoline and diesel fuel help to pay for highways.
The Penn Wharton Budget Model released estimates Wednesday showing that consumers saved at the pump because of gas tax holidays in Connecticut, Georgia and Maryland. The majority of the savings went to consumers, instead of service stations and others in the energy sector.
In an interview Sunday on ABC’s “This Week,” Treasury Secretary Janet Yellen expressed an openness to a federal gas tax holiday to give motorists some relief.
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“That’s an idea that’s certainly worth considering,” Yellen said. She added that President Biden wants “to do anything he possibly can to help consumers.”