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The Biden administration recognizes that gas pump prices are off the charts, over $5.00 a gallon in some states.
On Wednesday, President Joe Biden asked Congress to suspend federal gasoline and diesel taxes for three months, to ease the burden on the American public.
He will also reach out to state governments to suspend their gas taxes.
President Biden announced Monday that his administration was considering a federal gas tax suspension, similar to what has been done in Connecticut, Georgia and Maryland. It could save US consumers 18.4 cents a gallon on auto fuel, and 24.4 cents-a-gallon on diesel fuel.
Due partly to the war in Ukraine, and increased demand after COVID-19 and a summer surge in travel, gas prices across the nation have risen dramatically, and continue to go up.
Biden said his staff is meeting with oil company executives this week to talk about the rising prices. The administration feels that the oil companies are taking advantage of consumers and making huge profits. Demand is high but oil supplies are not increasing to meet the demand. Oil refiners say they are limited in their ability to produce more gas and diesel fuel, and that they are operating at near full capacity.
Democratic Senator Mark Kelly of Arizona and other Democratic senators introduced legislation in February to pause the federal gas tax until 2023, but the legislation hasn’t gone anywhere, due to opposition by Republicans. President Biden is asking Congress to increase their efforts and push a bill to the floor.
Connecticut suspended its federal gas tax until June 30. Some politicians are skeptical and say that using the Connecticut model shows that pausing the tax isn’t very effective because benefits don’t necessary reach consumers at the pump. However, a study by The Penn Wharton Budget Model (PWBM) estimated that consumers in the states with gas tax holidays did save money.
The debate continues. Some economists say the suspension might not make a big difference to drivers, and could even backfire on the economy.
The Biden administration’s effort to give relief to the public has already included releasing oil from the US strategic reserve and putting pressure on oil refiners to increase capacity. They are also considering rebates, which some states have already provided.
As gas prices continue to go up, Americans need relief, and will show their dissatisfaction at the polls in the mid-term elections coming up soon.
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