A federal gas-tax holiday sounds like relief. For the average American family, it would amount to about $35 over five months, roughly what it costs to fill half a tank.
Sen. Josh Hawley, a Missouri Republican, introduced the Gas Tax Suspension Act (S. 4485) during the 119th Congress. In May 2026, Democratic Sens. Mark Kelly of Arizona and Richard Blumenthal of Connecticut followed with their own companion measure targeting the same federal levy, while Rep. Chris Pappas carried a House version. The bipartisan lineup reflects genuine political anxiety over pump prices. The per-household arithmetic, though, tells a more modest story.
What the bill would do
Hawley’s legislation would pause the 18.4-cent-per-gallon federal excise tax on gasoline and the 24.4-cent-per-gallon federal diesel tax. The suspension would begin 90 days after the president signs the bill and could be extended beyond that initial window. Hawley’s office frames the measure as “immediate relief” from elevated pump prices, arguing the federal levy is one of the few fuel-cost levers Congress can pull directly.
The Kelly-Blumenthal version sets an expiration date of October 1, 2026, creating a roughly five-month relief window if enacted on schedule. According to the senators’ press release, their bill adds a provision Hawley’s text lacks: a requirement that the Treasury Department monitor retail prices to verify the tax cut actually reaches consumers rather than padding refiner or station-owner margins. No publicly available bill text for the Democratic version had been posted as of June 2026, so the precise statutory language of that monitoring requirement has not been independently confirmed.
The watchdog concept is not new. Economists raised the same concern during the state-level gas-tax suspensions several governors enacted in 2022, and the results from those experiments are now central to the debate over whether a federal holiday would deliver on its promise.
The $35 reality check
The federal gasoline tax is 18.4 cents per gallon. According to the U.S. Energy Information Administration’s 2022 Residential Energy Consumption Survey, the most recent available, the average American household uses roughly 1,100 gallons of gasoline per year. Over a five-month suspension, that works out to about 460 gallons. Multiply 460 by $0.184, and you land at approximately $35 in total savings, assuming every penny of the tax cut shows up at the pump.
That assumption is generous. A widely cited 2008 study by Joseph Doyle and Krislert Samphantharak examining gas-tax suspensions in Illinois and Indiana found that retailers and wholesalers absorbed a meaningful share of the savings rather than passing the full amount to drivers. “Consumers saw only about 70 percent of the tax savings at the pump,” Doyle and Samphantharak wrote, a finding that has shaped every subsequent gas-tax-holiday debate. More recent analyses of the 2022 state-level suspensions in Georgia, Maryland, and Connecticut, including work by the Tax Foundation and several academic working papers, showed pass-through rates ranging from roughly 60 percent to nearly 100 percent depending on local market competition. At a 70 percent pass-through rate, that $35 shrinks to about $24.50.
“Gas-tax holidays are popular with voters but the exposed savings are modest, and the risk of incomplete pass-through is well documented,” said Garrett Watson, senior policy analyst at the Tax Foundation, in a May 2026 analysis of the Hawley proposal. “The real question is whether Congress is willing to accept a multibillion-dollar hit to the Highway Trust Fund for single-digit monthly savings per household.”
Kelly and Blumenthal’s monitoring requirement is designed to prevent that slippage. But the publicly available bill summaries do not detail an enforcement mechanism or penalties for noncompliance, raising the question of whether the provision functions more as a political warning than a binding constraint.
For perspective, the average U.S. household spends roughly $150 to $200 per month on gasoline at recent pump prices. A $35 total saving spread across five months amounts to about $7 a month, or less than 5 percent of a typical gas budget.
The Highway Trust Fund gap
The federal gas tax is not just a line item on a receipt. It is the primary funding source for the Highway Trust Fund, which bankrolls road construction, bridge repairs, and transit projects nationwide. The fund collects roughly $35 billion to $40 billion a year from fuel taxes, a range consistent with the Congressional Budget Office’s January 2026 baseline projections for Highway Trust Fund revenues. A five-month suspension could drain an estimated $7 billion to $9 billion from that pool.
The fund is already under strain. The CBO has warned for years that the Highway Trust Fund’s outlays exceed its revenues, a gap Congress has plugged repeatedly with general-fund transfers totaling more than $275 billion since 2008. Suspending the gas tax without identifying a replacement revenue source would widen that gap at a time when the American Society of Civil Engineers rates the nation’s roads a “D” and its bridges a “C” in its most recent Infrastructure Report Card.
“Every dollar diverted from the Highway Trust Fund is a dollar that does not go to fixing a structurally deficient bridge or repaving a crumbling interstate,” said Dave Bauer, president and CEO of the American Road and Transportation Builders Association, in a May 2026 statement opposing the suspension proposals.
Neither Hawley’s bill nor the Kelly-Blumenthal version includes an offset or alternative funding mechanism. No Congressional Budget Office or Joint Committee on Taxation score has been published for S. 4485, so the precise fiscal impact remains officially unquantified.
Why this debate keeps coming back
Washington has been here before. In 2022, President Biden called on Congress to suspend the federal gas tax for three months as prices surged past $5 per gallon nationally. The House passed a version on a narrow party-line vote in June of that year, but the Senate never brought it to the floor. Critics from both parties argued the savings were too small to justify the revenue loss. Several states went ahead with their own suspensions, producing the mixed pass-through results economists now cite as cautionary evidence.
The political dynamics in mid-2026 are different. Gas prices have not hit the crisis levels of mid-2022, but they remain a persistent source of voter frustration, particularly in car-dependent Sun Belt and rural districts. For Kelly, whose Arizona constituents face long commutes across sprawling metro areas, and Hawley, whose Missouri base includes rural drivers logging serious mileage, the bill doubles as a messaging tool: a concrete, easy-to-explain response to a problem voters feel every time they fill up.
It is also worth noting what the federal tax does not cover. State gas taxes, which averaged about 32 cents per gallon nationally as of early 2026 according to the American Petroleum Institute, are untouched by either bill. In high-tax states like California, Pennsylvania, and Illinois, state levies add 50 cents or more per gallon. Drivers in those states would still face substantial tax costs at the pump even if the federal suspension passed.
What remains unresolved
Several questions hang over the effort. It is unclear whether Kelly and Blumenthal plan to co-sponsor Hawley’s specific bill or continue running parallel legislation toward the same goal. Their press announcement frames the effort as a separate introduction, not an endorsement of the Republican measure. That distinction matters for vote-counting: two similar bills splitting support across party lines can stall more easily than a single vehicle with unified backing.
Timing is another sticking point. Hawley’s bill includes a 90-day delay before the suspension takes effect. The Kelly-Blumenthal version ties relief to a calendar date. If the two approaches are merged, lawmakers will need to decide which clock governs and whether a three-month lag undercuts the “immediate relief” framing both sides have embraced.
Neither bill has received a committee hearing or markup as of June 2026. No publicly available Treasury or IRS dataset tracks actual pass-through rates from previous federal gas-tax proposals, which makes it difficult to predict with precision how much of the 18.4-cent cut would reach drivers. Kelly’s monitoring provision acknowledges the problem but does not resolve it.
What $7 a month means for the families Congress says it wants to help
If Congress passes a gas-tax suspension and the full savings reach the pump, a family driving an average amount would save about $7 a month. That is real money, but it is not the kind of relief that changes commuting habits, reshapes household budgets, or addresses the structural forces behind gasoline price swings, from refinery capacity constraints to global crude oil markets.
What the bill does accomplish is political. It gives lawmakers in both parties a tangible, bumper-sticker-ready response to voter frustration over fuel costs. Whether that response is worth the billions in forgone Highway Trust Fund revenue, and the road and bridge projects those dollars would have financed, is the question Congress dodged in 2022. In 2026, the math has not changed much. The politics, apparently, have not either.
Vince Coyner is a serial entrepreneur with an MBA from Florida State. Business, finance and entrepreneurship have never been far from his mind, from starting a financial education program for middle and high school students twenty years ago to writing about American business titans more recently. Beyond business he writes about politics, culture and history.
