Gas Prices Relief Act of 2026
- Sponsor
- Rep. Harder, Josh [D-CA-9]
- Committees
- Ways and Means Committee (primary)
- Last action
- Apr 29, 2026
Bottom line
This bill aims to lower gasoline prices for consumers by temporarily suspending federal fuel taxes, with the federal government backfilling lost trust fund revenue from the general fund.
What it actually does
This bill establishes a temporary gasoline tax holiday, reducing the federal gasoline tax rate to zero and suspending the Leaking Underground Storage Tank Trust Fund financing rate from its enactment date until January 1, 2027. To ensure continued funding for infrastructure, it mandates transfers from the general fund to the Highway Trust Fund and the Leaking Underground Storage Tank Trust Fund to offset the lost revenue. The bill also includes a policy statement urging fuel producers and dealers to pass these tax reductions directly to consumers, granting the Treasury Secretary authority to enforce this policy.
Proponents argue
Proponents argue that a gasoline tax holiday would provide immediate financial relief to consumers facing high gas prices, reducing the cost of transportation for individuals and businesses. They contend that by suspending the federal gas tax, families would have more disposable income, stimulating economic activity and easing inflationary pressures. The bill also ensures that critical infrastructure funding is maintained by backfilling the Highway Trust Fund from the general fund, addressing a common concern with gas tax holidays.
Opponents contend
Opponents typically argue that a gas tax holiday offers only marginal and temporary relief to consumers, as the savings may not be fully passed on by fuel retailers and could be absorbed by market fluctuations. They also raise concerns about the long-term implications of relying on general fund transfers to support infrastructure, potentially diverting funds from other priorities or increasing the national debt. Furthermore, critics suggest that such a measure could encourage more gasoline consumption, counteracting efforts to promote energy efficiency and reduce carbon emissions.
The bill text is very short and easy to read, allowing for quick comprehension of its core provisions.
Section 2(a)
Temporary Suspension of Federal Gasoline Tax
This provision sets the federal tax rate on gasoline to zero and suspends the Leaking Underground Storage Tank Trust Fund financing rate. This tax holiday applies to gasoline removed, entered, or sold from the bill's enactment date until January 1, 2027. The intent is to reduce the price consumers pay at the pump by eliminating the federal excise tax component.
Supporters argue
Supporters argue this is the core mechanism for providing immediate and tangible financial relief to American families and businesses by directly lowering the cost of gasoline. They contend it addresses current economic pressures and makes daily commutes and goods transportation more affordable.
Critics contend
Critics argue that the actual savings passed to consumers may be minimal or inconsistent, as market forces and retailer decisions can absorb some or all of the tax reduction. They also suggest it could temporarily increase demand for gasoline, potentially driving up pre-tax prices.
Tradeoffs
The primary tradeoff is between immediate consumer relief and potential market inefficiencies in passing on savings, as well as the broader policy implications of encouraging fossil fuel consumption.
Section 2(b)
General Fund Transfers to Highway and LUST Trust Funds
This section mandates that the Secretary of the Treasury transfer funds from the general fund of the Treasury to the Highway Trust Fund and the Leaking Underground Storage Tank Trust Fund. These transfers are intended to replace the revenue lost to these trust funds due to the temporary suspension of the gasoline tax, ensuring that critical infrastructure and environmental programs continue to be funded without interruption.
Section 2(c)
Policy on Passing Benefits to Consumers
This provision states that it is the policy of Congress for consumers to immediately receive the benefit of the tax reduction, and for transportation motor fuels producers and dealers to reduce prices accordingly. It also grants the Secretary of the Treasury authority to use "all applicable authorities" to ensure these benefits are passed on to consumers.