President Joe Biden requested a temporary exemption from gas taxes from Congress and state legislatures on Wednesday, but Republicans and members of his own party looked to be against it, making it appear improbable at the federal level.
In addition, a lot of state legislatures have adjourned for the year and won’t be reconvening until January.
However, Biden asked both federal and state politicians to grant a 90-day vacation from gas taxes, arguing that doing so would help ease the tight budgets many families are experiencing as gas costs rise.
Additionally, he requested that oil firms build more refineries that produce gasoline for automobiles. The minor drop in the price of gasoline per barrel and any savings from a gas tax holiday, he added, should be passed on to customers rather than retained by businesses.
About the federal gasoline tax, Biden said, “I call on the companies to pass along this, every penny of this 18-cent reduction, to the customers.” “Now is not the time for profiteering.”
According to him, prices could drop by $1 per gallon if all four scenarios came to pass: a state exemption, a federal tax holiday, more refining, and companies passing along decreased gas prices.
Gov. Mike DeWine’s spokeswoman in Ohio claimed on Wednesday that putting the state’s gas tax on hold would put a stop to roadway and infrastructure development without significantly lowering gas prices.
To put it bluntly, the enormous, two-state, nonpartisan Brent Spence Bridge project “cannot be funded without the gas tax,” the spokeswoman told Gannett Ohio.
The former mayor of Dayton and his Democratic opponent for governor in the general election, Nan Whaley, has proposed suspending Ohio’s 38.5 cents per gallon state gas tax from July 1 through the end of this year.
Democrats condemn the gas tax pause.
But it appears that his own party members are not on board.
Before Biden’s afternoon speech, Oregon Democrat and Chairman of the House Transportation and Infrastructure Committee Peter DeFazio opposed the notion of a gas tax holiday.
DeFazio said in a statement that although well-intentioned, the policy would only provide minimal relief while blowing a $10 billion hole in the Highway Trust Fund, which would need to be filled if repairs are to be made to deteriorating bridges, traffic fatality rates are to be addressed, and a modern infrastructure system is to be built.
Additionally, DeFazio stated, “encouraging state governments to suspend their gas taxes undermines the effectiveness of the Bipartisan Infrastructure Law by lowering monies available to states to spend on infrastructure projects.
In a statement, California Democrat and Speaker Nancy Pelosi said that she will “see where the agreement lies on the road forward for the President’s proposal in the House and the Senate.”
“The most critical thing we can do to cut gas costs is crack down on big oil’s manipulation of the oil markets,” said Senate Majority Leader Chuck Schumer, a Democrat from New York.
During the Obama administration, Jason Furman served as the Council of Economic Advisers chairman. On Tuesday, he predicted that a gas tax holiday wouldn’t likely offer much comfort to motorists.
Whatever you may have thought about the benefits of a gas tax break in February, he tweeted, “it’s a terrible idea now.” “Refineries are considerably more limited right now, thus the supply is almost inelastic. With only a few pennies perhaps going to consumers, the industry would keep the most of the 18.4 cent cut.
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Furman acknowledged that his earlier “guesstimation that two-thirds of the gains may flow to consumers” was “perhaps unduly generous at the time,” but he added this week that it was still a valid estimate.
“However, it would be even less presently. The author wrote that I would anticipate customers receiving no more than one-third of the benefits.
He continued that a nationwide gas tax holiday would probably increase inflation, albeit not significantly, “since the majority of it would be windfall profits for the oil business and that is not especially stimulative.” nevertheless continues to go the wrong way.
