What Is a Federal Gas Tax Holiday? And How Much Would You Save at the Pump?

A federal gas tax holiday would aim to lower the cost of filling up your car. But politicians and economists are divided over how much help it would provide. 

President Biden has called for a three-month suspension of the federal gasoline tax, as consumers cope with near record prices at the pump. The tax holiday is intended to provide relief to millions of Americans by temporarily pausing the 18.4-cent tax on every gallon of gasoline. 

The measure doesn’t seem guaranteed to pass. It would require congressional approval, with lawmakers in both parties expressing some misgivings about the plan. Moreover, economists say much of the savings might not end up reaching consumers’ wallets. 

Still, tax policy around gas is likely to remain hotly debated at the federal and state level as prices remain elevated. Here’s what you need to know:

What is a federal gas tax holiday? A gas tax holiday would give drivers a temporary break at the pump as fuel costs hover near record highs.