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June 22, 2022

ACEC Signs Letter Objecting to Gas Tax Holiday

ACEC Signs Letter Objecting to Gas Tax Holiday

Over the weekend President Biden indicated that he was considering a gas tax “holiday” in response to rising fuel prices. There are a number of good ideas the Administration could take that would provide greater stability to oil markets and long-term relief to rising gas prices but suspending the motor fuels tax is not one of them. This is a bad idea that will undercut one of the Administration’s most important accomplishments over the last year, and for this reason, ACEC is joining with the US Chamber of Commerce and a coalition of business and labor organizations strongly urging President Biden to reject any initiative to temporarily suspend the gas tax.

It’s not surprising that the concept has resurfaced in Washington, DC. With rising prices at the pump, elected officials are desperate for ways to show that they are responding to consumers stretched thin by inflation. We’re all feeling the pinch of higher prices these days across the board, but a gas tax holiday isn’t the answer.

Experience and data show that suspending the gas tax would have little impact on the price of gasoline. What we do know is that the collection of the user fee revenues at the pump has a direct line of effect on the solvency of the Highway Trust Fund. By suspending the gas tax, lawmakers would be undermining the Infrastructure Investment and Jobs Act, which is already being hampered by inflation in the cost of construction materials and labor.

Despite a handful of states that have taken it upon themselves to pass their own user fee suspensions, there is still little support in Congress for a federal gas tax holiday. The reason is simple – the state holidays failed to produce the desired effect while their own coffers for roadway improvements suffered.

But support in Congress could shift. Given enough oxygen, bad ideas can spread like wildfire in Washington, DC. We can’t give this bad idea oxygen.

America’s engineering firms know the successful implementation of the Infrastructure Investment and Jobs Act depends on a robust Highway Trust Fund fueled by user fees. It is counterproductive and short-sighted to suspend the bill’s primary funding source right as the Biden Administration is pushing for its full implementation.

ACEC is working closely with our stakeholder partners to urge the President and congressional leaders to reject the idea of a gas tax holiday. Please stay tuned for more information as this effort continues.


All comments to blog posts will be moderated by ACEC staff.

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