Congress likely to reject gas tax push

The U.S. Capitol is seen
Greg Nash
The U.S. Capitol is seen from the East Front Plaza at sunset on Monday, June 7, 2021.

Congress is likely to quash the White House effort to back a suspension of the federal gasoline tax.  The White House has flirted for weeks with the idea of temporarily halting the 18-cent tax as one way to bring relief to drivers amid record gas prices — and President Biden is expected to officially announce support for it on Wednesday.

But with skepticism spanning the ideological spectrum — from Speaker Nancy Pelosi (D-Calif.) to swing vote Sen. Joe Manchin (D-W.Va.) to much of the GOP — the idea is unlikely to make it across the finish line.  

Biden’s position on the gasoline tax issue had been unclear for weeks, but the president will call on Congress to suspend the federal gasoline and diesel taxes. 

White House Press Secretary Karine Jean-Pierre affirmed on Tuesday, prior to the announcement, that if Biden supported the measure, he’d be looking at an act from Congress.

“The way we see it is there would be congressional action,” Jean-Pierre told reporters during a press briefing.

“The president is looking at an array of options to figure out how he is going to help give relief to the American public, especially as they are looking at gas prices at the pump,” she said. “This is a No. 1 priority for the president.” 

Doubts about pausing the federal gasoline tax are coming from both allies and foes of the White House. 

Democrats have expressed concerns that some of the savings may get passed to oil companies rather than consumers and have also raised worries about a reduction in federal highway spending that is funded by the tax. 

“We have a situation where there’s money coming out of the Highway Trust Fund, it’s going to the oil companies, they may not give it to the consumer, and it has to be paid for. … That’s the con,” Pelosi, who is among those who have expressed reservations, said during a March press conference.  

Pelosi’s office declined to comment further for this story.  

Other Democrats, such as House Transportation and Infrastructure Committee Chairman Peter DeFazio (Ore.), have made similar points. 

“As discussions on possibly suspending the federal gas tax continue, I urge my colleagues to see this for what it is: a short-sighted proposal that relies on the cooperation of oil companies to pass on miniscule savings to consumers,” DeFazio said in a statement to The Hill prior to the administration’s announcement.  

“Suspending the federal gas tax will not provide meaningful relief at the pump for American families, but it will blow a multi-billion-dollar hole in the highway trust fund putting funding for future infrastructure projects at risk,” he added.   

Manchin, the Senate’s key swing vote, also expressed opposition to the idea in February. 

He said at the time that suspending the gas tax “just doesn’t make sense” because it would take money out of highway funding.  

“People want their bridges and their roads, and we have an infrastructure bill we just passed this summer, and they want to take that all away,” Manchin said. 

Manchin separately remains in talks with Senate Majority Leader Charles Schumer (D-N.Y.) about advancing another bill containing significant pieces of Biden’s agenda for climate, drug prices and tax reform. It’s not clear whether Democrats would be willing to expend additional political capital convincing him to support something that many members of the caucus also aren’t behind. 

Even if Biden could get all of the members of his own party to back a gas tax suspension, he’d likely need to convince 10 Republicans given the Senate’s filibuster rule.

But many Republicans are also skeptical of a gas tax suspension. They meanwhile are using the high gas prices as a cudgel to go after Biden’s energy policies. 

“A potential gas tax holiday subsidizes demand,” tweeted Sen. Chuck Grassley (R-Iowa) on Tuesday. “We don’t have a demand issue we [have] a SUPPLY issue since Pres Biden has waged war on fossil fuel production.” 

Most of the policies Biden has pursued are more likely to encourage a long-term shift from fossil fuels rather than a short-term shift towards them that would have a big effect on raising prices.  

The main reasons for higher gas prices are rising demand and changes in supply.  

 Over the past few days, the national average gasoline price has hovered around $5 per gallon, exacerbated by Russia’s invasion of Ukraine, reduced capacity at refineries that turn oil into gasoline and high gasoline demand amid the summer driving season. 

Swing-state Democrats have been among the loudest voices calling for a suspension of the gas tax as a way to reduce prices for consumers ahead of this year’s midterm elections.  

 Earlier this year — when gas prices were averaging around $3.50 per gallon nationwide — Sens. Mark Kelly (D-Ariz.) and Maggie Hassan (D-N.H.) introduced legislation in February to temporarily halt the tax.  

In a statement, Marisol Samayoa, a spokeswoman for Kelly’s office, stressed that the senator has worked on building support for the tax suspension — but didn’t directly address questions about whether the proposal currently has the votes to pass.  

“Since November, Senator Kelly has pushed Washington and the Biden administration to take immediate steps to bring down gas prices, like supporting his bill to suspend the federal gas tax through the end of the year and boosting domestic energy production,” Samayoa said.  

Morgan Chalfant contributed.

Tags Chuck Grassley Chuck Schumer economy Joe Biden Joe Manchin Karine Jean-Pierre Maggie Hassan Mark Kelly Nancy Pelosi Peter DeFazio

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