Federal Gas Tax Suspension: Trump’s Plan and Implications

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The federal gas tax—a 18.4-cent levy per gallon of gasoline—has become a focal point in Washington as President Donald Trump pushes to suspend it temporarily to ease soaring fuel costs amid the Iran war. While the proposal could provide modest relief at the pump, experts warn it may not deliver meaningful savings to consumers and could strain a critical federal fund for highway maintenance.

In remarks from the Oval Office on May 12, 2026, Trump announced his intention to “reduce” the federal gas tax, following earlier comments to CBS News that he would pause it “for a period of time.” The move comes as gas prices have surged 50% since the Iran conflict began on February 28, pushing the national average to $4.50 per gallon as of May 13, according to the American Automobile Association (AAA).

The federal tax—18.4 cents per gallon for gasoline and 24.4 cents for diesel—contributes to the Highway Trust Fund, which finances road construction and repairs. Suspending the tax would require congressional approval, but Republican lawmakers have already begun drafting legislation to advance the proposal. Sen. Josh Hawley (R-Mo.) introduced a bill on May 12 that would suspend the gas tax for at least 90 days if enacted.

Why the Proposal Faces Skepticism

While the suspension could lower pump prices slightly, analysts caution that the impact would be limited. The current oil price environment—ranging between $90 and $120 per barrel—is expected to persist, meaning most of the price increase at the pump is driven by global crude costs rather than domestic taxes. According to the U.S. Energy Information Administration, the federal gas tax accounts for less than 5% of the average retail price of gasoline.

Policy experts also warn that suspending the tax could deplete the Highway Trust Fund, which relies on gas tax revenue to cover $100 billion in annual infrastructure spending. Without additional funding, states and local governments may face delays in critical road and bridge projects.

Political Momentum and Next Steps

Trump’s proposal has gained traction among Republicans in Congress, with lawmakers framing it as a direct response to economic pressures on American families. However, Democrats and some fiscal conservatives have raised concerns about the long-term consequences for infrastructure funding.

The White House has not yet outlined a plan to offset the lost revenue, leaving open questions about how the suspension would be financed. Without congressional action, the gas tax remains in effect, though Trump’s push has intensified pressure on lawmakers to act.

Broader Context: Gas Prices and the Iran War

The surge in gasoline prices is directly tied to the ongoing conflict in Iran, which has disrupted global oil supplies. Since the war began in late February, crude prices have remained volatile, with no immediate signs of stabilization. The Federal Reserve has also signaled that inflation—including at the pump—will remain a key focus in its monetary policy decisions.

For now, motorists are left waiting for Congress to act. If the gas tax suspension passes, drivers could see a small but temporary reprieve at the pump. But without broader measures to address oil market fundamentals, the relief may be short-lived.