Trump's Gas Tax Holiday: A Band-Aid on a Bullet Wound?

Gas prices are soaring, and the blame is squarely on the U.S. conflict with Iran, which has thrown a wrench in global oil shipments. Enter President Donald Trump, who on Monday pitched a temporary federal gas tax holiday as a lifeline for drivers feeling the pinch at the pump.

In a recent chat with CBS News, Trump declared, “We’re going to take off the gas tax for a period of time, and when gas goes down, we’ll let it phase back in.”

“It’s a small percentage, but you know, it’s still money,” he added, as if a few cents could really make a dent in the wallet of the average American.

But hold your horses—this plan is riddled with complications. First off, Trump can’t just wave a magic wand and suspend the federal gas tax, currently sitting at 18 cents per gallon for regular gas and 24 cents for diesel. Congressional approval is a must, and so far, lawmakers have been slow to jump on this bandwagon. While there’s some bipartisan chatter about it, the reality is that drivers might end up paying more in the long run.

Even if this gas tax holiday becomes a reality, don’t expect to see your gas bill drop dramatically. The potential savings? A measly 9 to 14 cents per gallon, according to Xan Fishman, vice president of the energy program at the Bipartisan Policy Center.

AAA reported that the national average for a gallon of regular gas has hit $4.50—50% higher than last year. Fishman pointed out that gas was just $3.15 a year ago, so while a few cents saved is “not nothing,” it certainly doesn’t tackle the bulk of the price hike.

“At today’s national average, it’s a drop of only about 2.9% in the price of gasoline,” said Patrick De Haan, head of petroleum analysis at GasBuddy. He warned that this discount could actually ramp up demand and worsen price spikes.

Let’s not forget that the federal gas tax isn’t the only tax drivers face. States have their own taxes too, and some—like Georgia and Indiana—have already suspended theirs amid the ongoing conflict with Iran.

This gas tax suspension might save you a few cents now, but it’s not a sustainable solution for maintaining safe roads. The billions generated from the federal gas tax fund the Highway Trust Fund, which is crucial for local road and bridge improvements. The Bipartisan Policy Center estimates that a five-month suspension could slash gas tax revenue by around $17 billion. Fishman warns that this could lead to worse roads and more wear and tear on your tires.

And guess what? You might end up buying more gas just to navigate those bumpy roads. “When roads are well-maintained, people get better gas mileage, so you have to buy fewer gallons of gasoline,” Fishman explained.

Experts agree that the most effective way to tackle skyrocketing gas prices is to end the war against Iran, which has effectively closed off oil shipments through the Strait of Hormuz.

“It’s going to continue going up until either global demand comes down to better match the level of supply that we have or until the strait reopens,” De Haan stated. And even if that happens, “It might take the better part of a year for global inventories to catch up to the [months] of oil being blocked by the strait,” he added.

But don’t hold your breath for a U.S.-Iran deal anytime soon. Just this past Sunday, Trump shot down a U.S. ceasefire proposal as “TOTALLY UNACCEPTABLE!” on his social media platform.