President Joe Biden will ask the US Congress to suspend for three months a federal tax on the price of gasoline, which has soared in recent months, something that deeply angers Americans just months before the midterm elections.
The White House wants to eliminate a federal tax of 18 cents per gallon (3.78 liters) by September and will ask states, which also tax fuel at the pump, to do the same to “directly relieve American consumers who suffer from (Vladimir) Putin’s price hike,” Biden administration sources said.
The average price of a gallon of gasoline hit a record $5 in the US ($4,968 on Wednesday), up from $3 12 months ago.
The rise has consequences for the national economy and affects the US president’s approval rating, currently below 40%.
“The president is aware of the important challenge that high gasoline prices pose to working families, as gasoline costs have risen dramatically worldwide, by nearly $2 per gallon since Putin concentrated his troops on Ukraine’s borders,” said the sources.
Biden “understands that this suspension of the gas tax will not, in and of itself, offset the increased costs we are seeing,” they admitted.
“But he believes that at this unique time when the war in Ukraine imposes its costs on American families, Congress must do what it can to alleviate these families,” they added.
The suspension of the 18-cent federal tax, along with the 24-cent-per-gallon diesel tax, during the summer travel season is expected to cost the highway infrastructure fund, normally financed by these taxes, nearly $10 billion.
The government says other sources of revenue can make up for the fund’s shortfall.
In addition, the White House calls on states, which also impose different levels of taxes on gasoline, to temporarily eliminate tariffs or make compensation mechanisms available to drivers.
Several states have already adopted such measures, such as Connecticut and New York. On average, states charge 30 cents in taxes per gallon of gasoline.
But according to analysts, 46 states have yet to announce measures, including California, where gasoline has the highest taxes and is the most expensive in the country, with a price in excess of $6 a gallon.