Don't Pause the Gas Tax—Repeal It

Adam N. Michel

President Donald Trump told CBS News recently that he wants to “take off the gas tax for a period of time” to provide relief from high gas prices. Senator Josh Hawley says he’ll introduce legislation to suspend the gas tax. A temporary gas tax holiday is a gimmick, not a reform. But Congress should permanently repeal the federal gas tax.

Fix The Cause, Not The Symptom 

First, if the administration wants to bring down gas prices, it should end its unconstitutional, unauthorized, and unnecessary war in Iran. That’s what’s driving the price spike. According to AAA, the national average for regular gasoline was $4.52 per gallon on May 11, 2026. That’s up from just under $3 before the conflict, an increase of more than $1.50 per gallon.

Even if we generously assume that suspending the 18.4‑cent federal gas tax is immediately and entirely passed through to consumers, it would offset only about 12 percent of the war-driven price increase. Consumers would be much better off by simply ending the war (as taxpayers funding the war, they’d also be better off). 

But Full Repeal Would Provide Relief and Reform 

Rather than a temporary holiday, Congress should use this moment to eliminate the federal gas tax entirely and devolve highway funding to the states.

As Chris Edwards and I argued in 2023:

Federal gas tax revenues go into the Highway Trust Fund and then are dished out to the states to use on highway and transit projects. However, since 98 percent of the nation’s streets and highways are owned by state and local governments, it would be simpler and more efficient if those governments were responsible for the funding. Having the federal government raise the funds and then return the funds to the states with regulations attached is unnecessarily bureaucratic. States have the best information to determine their local infrastructure needs.

States have already shown they can take the lead. Average state gas tax rates rose 44 percent between 2000 and 2021. States know what their infrastructure needs are, and they have the fiscal tools—gas taxes, sales taxes, user charges, debt, and privatization—to meet them without a federal middleman.

Congress will have to pass a highway bill reauthorization before September 30, 2026. It should use that opportunity to permanently repeal the gas tax. A federal gas tax repeal would permanently lower prices and be a genuine step toward decentralizing government power. A temporary holiday is just a political gesture.