Biden considers gas tax holiday

Savings could add up to as much as 18.4 cents a gallon

President Joe Biden said Monday that he will decide by the end of the week whether he would support a federal gasoline tax holiday, possibly saving U.S. consumers as much as 18.4 cents a gallon.

“Yes, I’m considering it,” Biden told reporters after taking a walk along the beach near his vacation home in Delaware. “I hope to have a decision based on the data — I’m looking for by the end of the week.”

The administration is increasingly looking for ways to spare the public from higher prices at the pump, which began to climb last year and surged after Russia invaded Ukraine in February. Gas prices nationwide are averaging just under $5 a gallon, according to AAA.

Biden said members of his team were to meet this week with CEOS of the major oil companies to discuss rising prices. Biden lashed out at oil companies, saying they are making excessive profits when people are feeling the crunch of skyrocketing costs at the pump and inflation.

“I want an explanation for why they aren’t refining more oil,” Biden said.

The Biden administration has already released oil from the U.S. strategic reserve and increased ethanol blending for the summer, in additional to sending a letter last week to oil refiners urging them to increase their refining capacity. Yet those efforts have yet to reduce price pressures meaningfully, such that the administration is now considering a gas tax holiday. Taxes on gasoline and diesel fuel help to pay for highways.

The Penn Wharton Budget Model released estimates showing that consumers saved at the pump because of gas tax holidays in Connecticut, Georgia and Maryland. The majority of the savings went to consumers, instead of service stations and others in the energy sector.

Treasury Secretary Janet Yellen on Monday said “consumers are really hurting from higher gas prices“and remained open to a gas tax holiday.

“While not perfect, it is something that should be under some consideration as a policy to address it,” Yellen said.