BGOV OnPoint: Gas Tax Holidays Floated With Mixed Reception

May 20, 2026, 9:00 AM UTC

Calls for a gas tax holiday have grown at the federal and state level as policymakers look to alleviate a key pain point for consumers ahead of the midterm elections.

Average US fuel costs remain more than 40% higher than they were last year, as protracted negotiations between the US and Iran leave the Strait of Hormuz largely closed to freight traffic.

Temporarily halting federal fuel taxes — which add 18.3 cents per gallon for gasoline and 24.3 cents per gallon for diesel, on top of state-level taxes — represent one of the few levers policymakers could pull to decrease ...

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