Joe Biden Warned Gas Tax Holiday Threatens Jobs, Vital Infrastructure

Dozens of transport and infrastructure groups have warned President Joe Biden that his plan to suspend the federal gas tax will jeopardize road maintenance and upgrades.

The Americans for Transportation Mobility (ATM) coalition and the Transportation Construction Coalition (TCC) said that Biden's call for Congress to suspend the 18.4 cent per gallon tax for three months would have a knock on effect for American roads, bridges, transit systems and jobs.

The taxes fund road and public transport infrastructure through the Highway Trust Fund (HTF), but a White House fact sheet said suspending the levy for three months was essential to help Americans deal with soaring gas prices caused by "(Vladimir) Putin's war in Ukraine."

However, in a letter to Biden, 33 groups said that the gas tax holiday, costing around $10 billion, risks undermining funding for the HTF, "which is essential for our economy's long-term, sustained growth."

It said that Biden's plan would also "undermine efforts" to create jobs and realize the investments made under the Infrastructure Investment and Jobs Act (IIJA).

Letter Expressing Concerns

The letter sent Wednesday said the cut in HTF revenue brought about the gas tax holiday "also jeopardizes the certainty necessary for our state and local partners to plan long-term projects and the association hiring and equipment purchasing required."

The American Council of Engineering Companies, the American Public Transportation Association and the American Trucking Associations were among the 33 signatories to the letter, which said the tax holiday "would very likely hurt efforts to improve the safety and condition of our roadways, bridges, and transit systems."

The CEO of another of the letter's signatories, Portland Cement, described Biden's proposal as "the wrong decision at the wrong moment."

"Removing the funding from the gas tax will strangle the IIJA before it is even up and running," Michael Ireland said in a statement to Newsweek.

America's cement manufacturers have committed to reaching carbon neutrality in the construction chain by 2050 and Ireland said that this aim and the sustainability goals of the IIJA "dovetail nicely."

"However, achieving these goals requires significant funding," he said, noting that "the gasoline tax is crucial for meeting these funding needs."

After peaking at $5.016 per gallon on June 14, the national average for gas prices eased to $4.955 on Thursday. That's still much higher than the $3.069 cost about a year ago.

It has put Biden under pressure to help ease pain at the pump for Americans who are also dealing with consumer inflation hitting a 40-year high last month.

But congressional Democrats such as House Speaker Nancy Pelosi, House Majority Leader and Senator Tom Carper have expressed doubts about whether a federal gas tax holiday is the best way to ease high gas costs for Americans.

Pelosi has previously argued that oil companies don't necessarily pass the tax holiday on to the consumer, and suggested gas rebate cards or direct payments to consumers would be better.

Carper, from Biden's home state of Delaware, tweeted: "Suspending the primary way that we pay for infrastructure projects on our roads is a shortsighted and inefficient way to provide relief."

The White House fact sheet released Wednesday suggested that the gas tax holiday would have "no negative effect" on the HTF, given that the U.S. deficit was down by a "historic $1.6 trillion this year."

It said that Biden believes "we can afford to suspend the gas tax to help consumers while using other revenues to make the Highway Trust Fund whole."

"President Biden understands that a gas tax holiday alone will not, on its own, relieve the run up in costs," it said, adding that: "Congress should do what it can to provide working families breathing room."

Newsweek has contacted the White House for comment.

President Joe Biden
President Joe Biden speaks about gas prices in the South Court Auditorium at the White House campus on June 22, 2022 in Washington, DC. Biden called on Congress to temporarily suspend the federal gas tax. Drew Angerer/Getty Images

Editor's Picks

Newsweek cover
  • Newsweek magazine delivered to your door
  • Unlimited access to
  • Ad free experience
  • iOS and Android app access
  • All newsletters + podcasts
Newsweek cover
  • Unlimited access to
  • Ad free experience
  • iOS and Android app access
  • All newsletters + podcasts