Sponsors (3)
The bill lowers pump prices and protects highway and tank‑cleanup funding in the short term by using general‑fund transfers, but it raises federal outlays and fiscal risk while creating planning uncertainty and weakening long‑term incentives to reduce fuel use.
Drivers, commuters, and businesses pay less at the pump while the federal fuel excise suspension is in effect, lowering short-term transportation fuel costs for households and firms.
State transportation agencies and transit projects keep receiving promised Highway Trust Fund funding because the general fund will replace suspended excise receipts, preserving highway and transit construction and jobs.
State cleanup programs for leaking underground storage tanks continue to be funded because the LUST Trust Fund is made whole through transfers from the general fund, maintaining environmental remediation capacity.
All taxpayers face higher federal outlays because the general fund covers suspended excise revenues, which could increase the deficit, crowd out other spending, or require future offsets.
Fuel distributors, state planners, and transportation projects face uncertainty because phased reimplementation and presidential discretion on timing create unclear future funding and planning horizons.
Consumers and policymakers lose a persistent price signal for fuel costs while the suspension is in place, which may slow investments in fuel efficiency and alternative fuels and hinder long-term emissions reductions.
Based on analysis of 2 sections of legislative text.
Temporarily suspends specified federal fuel excise tax rates and LUST financing rate and requires Treasury to replace lost receipts to trust funds from the general fund.
Suspends federal excise tax rates on certain taxable motor fuels for a short, temporary period and requires the Treasury to replace lost receipts to highway and underground storage cleanup trust funds from the general fund. The tax holiday begins on enactment and normally lasts 90 days, but the President can extend it up to 215 days or authorize a phased reimplementation starting after 90 days.
Official title: To amend the Internal Revenue Code of 1986 to provide a tax holiday for gasoline and diesel fuel.
Introduced May 12, 2026 by Nicole Malliotakis · Last progress May 12, 2026