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Federal Gas Tax Pause Unlikely to Cut Prices Despite Trump Proposal

New York Times Business •
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President Trump proposed suspending the 18.4-cent-a-gallon federal gas tax to lower pump prices, but analysts warn it would save drivers only about $5 a month and face congressional gridlock. The tax, unchanged since 1993, funds highway maintenance via the Highway Trust Fund but generates insufficient revenue. $2.4 billion in monthly federal revenue would be lost if suspended, risking infrastructure projects. While states like Indiana have previously halted fuel taxes, federal action requires bipartisan support—a hurdle given past rejections, including during Biden’s 2022 Ukraine crisis response. Crude oil prices, accounting for over half of gas costs, remain the dominant driver of high prices, with geopolitical tensions prolonging supply disruptions.