US President Biden delivers remarks on efforts to lower high gas prices within the South Court Auditorium at Eisenhower Executive Office Constructing June 22, 2022 in Washington, DC.
Jim Watson | AFP | Getty Images
President Joe Biden called on Congress Wednesday to suspend the federal gas tax for 90 days as prices on the pump surge to record highs.
The federal tax currently stands at 18 cents for a gallon of standard gasoline, and 24 cents per gallon for diesel.
“I call on the businesses to pass this along — every penny of this 18 cents reduction — to the patron,” Biden said Wednesday. “There is no time now for profiteering.”
The president said such a move could have no impact on the Highway Trust Fund, saying other revenues may be used to fund the roughly $10 billion cost.
Biden also called on states to suspend their gas taxes, or find other ways to bring some relief.
Still, some were quick to notice that suspending the gas tax will keep demand regular and never address the structural issues available in the market.
Demand for petroleum products has bounced back as global economies reopen, while supply has remained constrained. An absence of refining capability also has sent prices higher.
“I fully understand that the gas tax holiday alone isn’t going to repair the issue. But it should provide families some immediate relief. Just slightly little bit of respiratory room as we proceed working to bring down prices for the long haul,” Biden said.
Prices are rising across the board with inflation at a 40-year high, however the surge in gasoline prices is particularly notable. The national average for a gallon of tax topped $5 for the primary time on record earlier this month.
Biden has called the surge in prices “Putin’s price hike.” He has also blamed oil and gas corporations for what he calls prioritizing profits on the expense of consumers.
Last week, he sent a letter to the CEOs of the biggest refining corporations urging them to extend output. Industry executives say even in the event that they wanted to spice up operations, they’re constrained from doing so due to labor shortages and other issues.
“[M]y message is easy: to the businesses running gas stations and setting those prices on the pump, it is a time of war … these aren’t normal times. Bring down the value you might be charging on the pump to reflect the price you might be paying for the product,” the president said.
Biden said these actions could lead on to prices on the pump dropping by $1 per gallon or more. “It doesn’t reduce all of the pain, but it should be an enormous help,” he said.
It stays to be seen whether the White House’s call will gain support on Capitol Hill.
“Although well intentioned, this policy would at best achieve only minuscule relief while blowing a $10 billion hole within the Highway Trust Fund that might should be filled if we would like to proceed to repair crumbling bridges, address the spike in traffic deaths and construct a contemporary infrastructure system,” said Rep. Peter DeFazio, a Democrat from Oregon and chair of the House Committee on Transportation and Infrastructure.