In an effort to challenge record pump prices and offer short-term respite to American consumers this summer, Joe Biden urged Congress on Wednesday to approve a three-month suspension of the federal fuel tax.
The official added that the president challenged major oil companies to present ideas on how to restart idled refining capacity when they meet with his energy secretary later this week. The president also urged states to temporarily suspend state fuel taxes, which are frequently higher than federal rates.
Since the president’s approval ratings are at an all-time low due to record-high petrol prices, Democrats’ chances of keeping control of Congress in November are in jeopardy. Biden and his advisers have been debating this matter for months amid mounting pressure to take action.
Congress would need to approve any suspension of the federal gasoline tax of 18.4 cents per gallon and the diesel tax of 24.4, so Biden’s proposal is probably primarily symbolic.
Both Democratic and Republican lawmakers have expressed opposition to suspending the tax. Some Democrats, including Speaker of the House Nancy Pelosi, are concerned that the action may have little impact on pricing if oil firms and retailers keep the majority of the savings.
The White House issued a statement saying, “A gas tax holiday alone will not, on its own, reduce the run up in expenses that we’ve seen.” Congress should take whatever action it can to give working families breathing room at this particular time when the war in Ukraine is costing American households.
According to the report, Biden is requesting that Congress postpone the fuel tax until September. This will cost the Highway Trust Fund $10 billion in lost revenue, but it could be offset by increased spending in other parts of the budget as the country recovers from the COVID-19 pandemic.
While other states have discussed alternatives like consumer refunds and direct assistance, several states, like New York and Connecticut, have already suspended their state fuel taxes. The statement by Biden, which will be made in a speech this afternoon, was initially reported on Tuesday night.
Diesel and gasoline shortages and high prices are being exacerbated by refiners’ struggles to meet the world’s demand.
The imbalance between supply and demand for petroleum products is the basis of the problem, according to a representative of the American Fuel and Petrochemical Manufacturers industry group. The representative added that longer-term strategies are still required to increase U.S. energy production.
Due to the high demand for motor fuels and the loss of around 1 million barrels per day of processing capacity, U.S. pump prices are now close to $5 per gallon. When fuel consumption plummeted at the height of the COVID-19 outbreak three years ago, many plants had to be shut down.
Are you sick of seeing ads? Well then it's time to get rid of them! WayneDupree.com is proud to offer a PREMIUM VIP MEMBERSHIP that eliminates ads and gives you the BEST browsing experience.
Follow Wayne on Rumble!