Sponsors (5)
The bill provides near-term relief at the pump for motorists while maintaining infrastructure funding, but it shifts costs to the general fund—raising deficit pressures and potentially weakening conservation incentives and adding enforcement burdens.
Drivers and consumers (including low- and middle-income families) will pay lower at-the-pump gasoline prices from enactment through Sept 30, 2026 due to the temporary suspension of the federal gasoline excise tax.
Highway and Leaking Underground Storage Tank (LUST) programs keep receiving full funding because the Treasury is required to transfer amounts equal to lost excise-tax receipts from the general fund, protecting infrastructure programs and workers.
Consumers (especially low-income purchasers) gain protection because the bill directs fuel sellers to pass through the tax cut to prices and authorizes monetary penalties for failing to reduce prices appropriately.
All taxpayers face higher federal outlays because the tax holiday is paid from the general fund, increasing the deficit or creating pressure to cut or offset other spending.
Drivers and households may face weaker incentives to conserve fuel or invest in cleaner alternatives during the holiday, which could increase emissions and slow demand-side shifts.
Federal agencies and fuel regulators may incur additional administrative and enforcement costs to monitor pass-through and collect penalties, increasing workload for Treasury and related agencies.
Based on analysis of 2 sections of legislative text.
Temporarily zeros the federal gasoline excise and LUST financing rates through Sept 30, 2026, and directs Treasury to transfer equal amounts from the general fund to replace lost Highway Trust Fund and LUST receipts.
Official title: To amend the Internal Revenue Code of 1986 to provide a gasoline tax holiday.
Introduced March 12, 2026 by Chris Pappas · Last progress March 12, 2026
Temporarily sets the federal gasoline excise tax rate to zero and suspends the LUST financing rate for gasoline sold from enactment through September 30, 2026. The Treasury Secretary must transfer from the general fund to the Highway Trust Fund and the LUST Trust Fund amounts equal to the lost receipts and take actions (including penalties) to ensure fuel sellers pass the tax reduction on to consumers.