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Democrats cool to Biden’s proposed gas tax holiday

Gas prices are soaring, but lawmakers from both parties are skeptical of a gas tax holiday.
John Minchillo/Associated Press
Wallace Reid finishes fueling the vehicle he drives to make a living using ride-share apps, Wednesday, June 22, 2022, in the Queens borough of New York. Millions of Americans who rely on their cars for work are changing their habits, signing up for carpools or even ditching their cars for bicycles as gas prices recently hit $5 per gallon for the first time ever. (AP Photo/John Minchillo)

President Biden’s push for a gas tax suspension amid soaring fuel prices is receiving a cool reception among Democrats on Capitol Hill.

Party leadership did not commit to taking up a gas tax moratorium, which requires an act of Congress, and the caucus remains largely divided on the issue. 

But, even if Democrats were unified, pausing the tax would face an uphill battle in the Senate because of Republican opposition. 

Biden on Wednesday officially endorsed the idea of a gas tax holiday – calling on Congress to suspend the 18-cent tax for 90 days — an attempt to offset high prices during the busy summer driving season.

But Congress does not seem to be heeding the call. Asked about gas tax suspension, Senate Majority Leader Chuck Schumer (D-N.Y.) indicated that the chamber would instead be focused on passing legislation targeting Big Oil. 

“Senate Democrats tried to pass it recently and it was blocked by Republicans,” Schumer said of the gas tax break. 

“I believe the most important thing we can do to lower gas prices is crack down on Big Oil’s manipulation of the oil markets,” he added. “We have legislation to do that and we’re going to focus on that issue.”

Speaker Nancy Pelosi (D-Calif.) also didn’t commit to anything, saying in a statement: “We will see where the consensus lies on a path forward for the President’s proposal in the House and the Senate.”

Pelosi has previously expressed concerns about a possible suspension of the gas tax, questioning whether the savings would actually get passed to consumers and expressing concerns that money would come out of the Highway Trust Fund, which helps pay for infrastructure.

“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,” she said. 

On Wednesday, House Majority Leader Steny Hoyer (D-Md.) said it wasn’t clear if the pause on the tax would have enough support to pass.

Democrats are split on the issue — and not along typically ideological lines. Centrist Sen. Joe Manchin (D-W.Va.) expressed skepticism Wednesday, telling ABC News, “I have great concern.”

He expressed worries about taking money out of the federal budget, whether the move would actually be effective and the political ramifications of reinstating the tax shortly before the November election. 

His qualms put him in a similar lane as the far more liberal Sen. Elizabeth Warren (D-Mass.), who told CNN “that’s not the approach I would use” when asked about the gas tax suspension. 

Lawmakers who are prominent voices on infrastructure have also expressed concerns, since the gas tax provides federal funds that are used to repair roads and bridges. 

And while the Biden administration has called for Congress to find other funding sources to make up for the lost revenue, Senate Environment and Public Works Chairman Tom Carper (D-Del.), whose committee has jurisdiction over the nation’s roads, was skeptical.

“Where would the money come from? And we just borrow more money?” he asked The Hill. “We’re issuing enough debt already.” 

House Transportation and Infrastructure Committee Chairman Peter DeFazio (D-Ore.)had previously described the move, as a “short-sighted proposal that relies on the cooperation of oil companies to pass on miniscule savings to consumers” in a statement to The Hill.

In his speech on Wednesday, Biden also addressed the idea that there might not be tremendous savings at the pump.

“I call on the companies to pass this along — every penny of this 18 cent reduction — to the consumers. There’s no time now for profiteering,” he said. 

Meanwhile, one of the most vocal supporters of a gas tax pause, Sen. Maggie Hassan (D-N.H.), was dissatisfied with the timeline Biden offered. 

“While I am encouraged that the President now supports a gas tax holiday, I continue to believe that we should seek to suspend the gas tax for at least the rest of the year, not just 90 days,” she said in a statement. 

Hassan is among the Senate Democrats facing a tough reelection battle this fall, with high inflation and fuel prices in particular proving a major political liability for the party.

Another key lawmaker, Sen. Ron Wyden (D-Ore.), chairman of the Senate Finance Committee, which has jurisdiction over taxes, appeared at least to be open to the proposal.

“Americans are struggling to fill their gas tanks, and anything we can do to relieve the pain at the pump is worthwhile. I support all of President Biden’s efforts in this space,” he said in a statement.

But Wyden also noted that “suspending the gas tax isn’t a silver bullet, and it’s important to also look at policies like my excess profits tax.”

A committee spokesperson declined to comment on the panel’s schedule, including whether there are plans to take up gas tax legislation. 

Even if all of the Democrats would get on board, many Republicans have also expressed opposition, and it’s not clear whether Democrats would be able to find a way around the Senate’s 60-vote threshold. 

But asked about the gas tax holiday’s prospects on Wednesday, Energy Secretary Jennifer Granholm said that the administration would try to convince Congress of its position.

“He’s going to be having these conversations with Democrats and Republicans. I would hope that both sides of the aisle are listening to their constituents about getting relief. I think the citizens will be the loudest voice…in the room,” she said during a White House press briefing. 

Tags Biden Chuck Schumer gas prices Gas Tax Gas tax holiday Inflation Joe Manchin Nancy Pelosi Ron Wyden

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