On June 22, Americans got a look at the Federal Fuel Tax Holiday plan from the Biden administration. The 90-day moratorium on the Federal Gas Excise Tax of 18.4 cents per gallon and Federal Diesel Excise Tax of 24.4 cents per gallon is aimed at helping lower prices at the pumps.
House Resolution 6787, The Gas Prices Relief Act of 2020, brought to the floor by Rep. Tom O’Halleran, a Democrat from Arizona, and signed by seven other members of Congress, has been forwarded to the House Ways and Means Committee for review. It joins California Democrat Rep. Adam Schiff’s Federal Gas Tax Suspension and Windfall Profits Tax Act of 2022, which was introduced on May 31.
America’s Checkbook paying for this tax break
FreightWaves’ Washington, D.C. correspondent, John Gallagher, posted an article Wednesday after news broke about the plan. In the article, Gallagher wrote about the highlight on the released fact sheet being that the cost of the holiday was “expected” to be around $10 billion. Biden plans to tap the U.S. Treasury General Fund, better known as the government checkbook, to cover the lapse in tax input.
With summer construction season and that shiny new Infrastructure Investment and Jobs Act (IIJA), that is a cornerstone of the “Biden legacy,” going into full swing, the administration cannot allow itself to be mocked right now. Financial experts are watching closely, waiting to bite, if there is a lapse in payment to contractors and (Heaven forbid) a work stoppage due to government funding reallocations.
When ATA and OOIDA think the same thing, take notice
Many media pundits “aren’t buying what Biden is selling” with this operation. We even have the American Trucking Associations (ATA) and the Owner-Operator and Independent Driver Association (OOIDA) on the same side of the fence. That speaks volumes about the opinions that many in the logistics industry are having about the “holiday.”
The ATA released a statement from President and CEO Chris Spears in which he called the tax holiday a “pure gimmick” and called for more direct action “on lowering energy prices and reducing inflation.”
“After months of touting the passage of the well-funded Infrastructure Investment and Jobs Act – a much-needed investment in our nation’s roads and bridges – the Biden administration wants to cut that same highway system’s primary source of funding with a suspension of the federal fuel tax. Here are three immediate things this administration and Congress can do that will actually make a difference. Make America energy independent… stop kissing the ring of Saudi Arabia. Renew trade agreements with the European Union and Asian Pacific nations in order to export more American oil and natural gas. And, balance the budget… stop wasting hard-earned taxpayer dollars on senseless programs that drive up inflation and runaway deficits. Energy independence, trade and a balanced budget. Do that, and America wins.”– American Trucking Associations President and CEO Chris Spears
OOIDA shows Democrats do not want to go along with the plan
The OOIDA, through its publication “LandLine,” posted an article by Associate Editor Mark Schremmer in which the group also put in its two cents. The group took a negative stance in the article, showing that even fellow Democrats were not going along with the fuel tax holiday.
It featured the statement of House Transportation and Infrastructure Committee Chairman Peter DeFazio, a Democrat from Oregon, rebuking the idea that any fuel tax holiday would work and promoting his own bill, H.R.7099, Stop Gas Price Gouging Tax and Rebate Act.
“As discussions on possibly suspending the federal gas tax continue, I urge my colleagues to see this for what it is: a short-sighted proposal that relies on the cooperation of oil companies to pass on miniscule savings to consumers. The same oil companies that made record profits last year and a staggering $35 billion in the first quarter of 2022. Suspending the federal gas tax will not provide meaningful relief at the pump for American families, but it will blow a multibillion-dollar hole in the Highway Trust Fund, putting funding for future infrastructure projects at risk. We should deliver relief directly to American families struggling to make ends meet by ending price gouging and profiteering, not by passing a well-intentioned but ill-conceived policy that undermines the long-term positive impacts of the bipartisan infrastructure law. That’s why I introduced the Stop Gas Price Gouging Tax and Rebate Act, which would tax the oil industry’s obscene 2022 profits and return the revenue back to Americans.”– U.S. Rep. Peter DeFazio