Biden Calls for 3-Month Gas Tax Suspension to Provide Relief at the Pump
- Many consumers are struggling in the wake of higher gas prices.
- The Biden administration is taking steps to ease that burden.
Talk about giving drivers a much-needed break.
These days, many consumers are buckling under the weight of rising living costs. Inflation has been rampant for months on end, and at this point, many people are resigning themselves to depleted savings and sky-high credit card bills in the absence of real relief.
But some relief may be in store with regard to gas prices, which have soared not just due to inflation, but also, as a result of the Ukraine conflict. And if that relief kicks in, it could spare some drivers a world of financial pain.
Taking steps to combat higher gas costs
It's no secret that gas prices are through the roof -- and the timing of that couldn't be worse. Earlier this year, many people had the option to hunker down at home and keep their driving to a minimum while the COVID-19 omicron strain raged on.
But at this point, more people are being called back to in-person work. And that means a lot of drivers are being forced to log extra mileage at a time when gas prices are at a high.
Thankfully, the Biden administration is taking steps to address the issue -- and provide motorists with some much-needed relief. Biden is calling on Congress to suspend federal gas and diesel taxes for three months. The president will also call on states to suspend their own gas taxes.
Right now, the federal gas tax amounts to $0.184 per gallon. For diesel fuel, it's $0.244 per gallon. If those taxes are suspended, drivers would save about 3.6% at the pump at a time when gas prices are averaging around $5 a gallon on a national level.
Clearly, any amount of savings at the pump right now is apt to come in handy. But a three-month gas tax suspension may, unfortunately, only provide minimal relief in the wake of rampant inflation.
In fact, Biden previously acknowledged that there's little he can do to address the issue of sky-high food and gas costs. So while it's good that an effort is being made to offer up some degree of relief, many drivers might continue to struggle financially even if Biden's plan goes through.
A recent analysis by Moody's revealed that the bulk of the 8.6% inflation seen over the past one-year period can be attributed to the Ukraine conflict as well as leftover disruptions from the pandemic. Those are situations the Biden administration can't control.
Of course, this doesn't mean that consumers are doomed to high gas prices and living costs forever. But should Americans expect to keep paying up in the coming months? Unfortunately, yes.
Making matters worse is that some consumers can't simply address the problem at hand by cutting back on living costs, because many are already living a bare-bones lifestyle. One silver lining, though, is that the job market is currently very strong. And so those who are struggling financially can try seeking out higher-paying jobs or side jobs to give their income a boost and ride out this period of inflation.
Alert: highest cash back card we've seen now has 0% intro APR until nearly 2025
If you're using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.
In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.
Our Research Expert
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.
Copyright © 2018 - 2023 The Ascent. All rights reserved.