By Zoe Richards -
NBC News
President Joe Biden will ask Congress on Wednesday to pass legislation creating a three-month federal tax break on gasoline and diesel in an effort to lower prices for consumers, according to senior administration officials.
The pause would cut 18 cents from each gallon of gasoline and 24 cents from diesel at a time when the summer driving season is underway.
The cost of the law is estimated to be $10 billion, a senior administration official told reporters in a call.
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“With a historic deficit of $1.6 trillion this year, the President believes we can afford to suspend the gas tax to help consumers, while using other revenues for the Trust Fund to cover the cost of some $10 billion of dollars," the official explained.
The officials detailed that Biden would ask Congress to make the temporary adjustment in a way that would not hurt the Highway Trust Fund, which derives its revenue from fuel taxes.
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Many lawmakers, mostly on the Republican side, have cited the trust fund as a reason they would not support a tax holiday, though some congressional Democrats have also been critical of a gas tax holiday.
Democrats are facing major headwinds just months before the November midterm elections, as numerous polls show gasoline prices and inflation as voters' top concerns.
Biden is scheduled to deliver a speech Wednesday at 2 p.m. about gasoline prices and what his administration has called "Putin's price hike," referring to Russian President Vladimir Putin.
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During those remarks, Biden also plans to ask state and local governments to provide additional relief to consumers by pausing the state sales tax on gasoline or similar actions, according to senior administration officials.
Several states have previously implemented their own tax breaks.
According to data from the American Automobile Association (AAA) on Tuesday, the national median price was $4.96, with prices higher in parts of the West Coast and Midwest.
Mario Beccera, of Fontana, fills up his gas tank at a Mobil gas station in Pasadena, Calif., on Thursday, April 28, 2022.Francine Orr / Los Angeles Times via Getty Imag
The new administration effort comes after Biden said Monday that he was seriously considering halting the federal gas tax as the White House seeks to take steps to reduce costs at the pump ahead of the holiday. July 4th.
Energy Secretary Jennifer Granholm, who is scheduled to meet with oil refinery executives Thursday, said on CNN's
State of the Union
that "part of the challenge with the gas tax, of course, is that finances the highways.
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Asked about the possible impact on infrastructure plans, Biden told reporters Tuesday that "it's not going to have an impact on road construction and major repairs."
Biden's push for a gas tax pause would come months after his administration stepped up its actions to combat gasoline prices in April by releasing a million barrels a day of Strategic Petroleum and issuing an emergency waiver to suspend a summer ban on the use of a specific blend of fuel ethanol.