Trump Proposes Suspending Federal Gas Tax Until Iran Conflict Ends

Higher fuel prices are squeezing household budgets as global tensions mount. President Trump has asked Congress to suspend the federal gas tax for the duration of the Iran conflict, a step that would cut roughly 18 cents per gallon from the pump for American drivers. The proposal arrives against a backdrop of elevated inflation and uncertainty over energy supplies.

The federal gas tax has remained unchanged at 18.4 cents per gallon since 1993. Trump tied the suspension explicitly to the end of hostilities involving Iran, arguing the temporary measure would deliver quick relief without permanent damage to highway funding. Lawmakers in both parties have floated similar ideas in past price spikes, though none advanced to enactment.

In California the contrast is sharp. The state levies 61 cents per gallon in excise taxes, the highest in the nation, before sales taxes and fees are added. Governor Gavin Newsom has declined to suspend or reduce those levies. The same taxes were at the center of a 2018 ballot fight when voters considered Proposition 6 to repeal a recent increase. Attorney General Xavier Becerra drafted the official summary as one that would eliminate dedicated road-repair revenue. A trial judge found the wording misleading, but an appeals court upheld the attorney general’s discretion. A contemporaneous poll showed support for repeal rising from 39 percent under the official description to 50 percent when the measure was described plainly.

Revenues from California’s 2017 gas-tax increase are statutorily earmarked for specific highway and bridge projects. Any suspension would therefore require either spending cuts or replacement revenue. Trump’s federal proposal carries the same structural question at a national scale, though the White House has not yet detailed how the Highway Trust Fund would be backfilled during the pause.