Home Financial Record Biden calls on Congress to suspend gas tax to help lower record pump prices

Biden calls on Congress to suspend gas tax to help lower record pump prices

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WASHINGTON, June 22 (Reuters) – U.S. President Joe Biden on Wednesday called on Congress to pass a three-month suspension of the federal gas tax to help tackle record high prices at the pump, but opposition from lawmakers within his own party suggest the request is unlikely to go through. to be met.

In announcing his support for the suspension, Biden also echoed some of the concerns about its effectiveness, but said American families who pay far more for gas, caused in part by Russia’s invasion of Ukraine , deserve financial assistance.

“I fully understand that a gas tax waiver alone will not solve the problem, but it will provide families with immediate relief, just a bit of respite, as we continue to work to bring prices down. long term,” Biden said. .

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The president also urged states to temporarily suspend state fuel taxes, which are often higher than federal rates. He is asking major oil companies to suggest ideas on how to bring back idle refining capacity when they meet with Energy Secretary Jennifer Granholm on Thursday. Read more

Biden and his advisers have been discussing the issue for months amid growing pressure to act as record gasoline prices weigh on the president’s opinion polls and cast doubt on the Democrats’ chances of retaining power. to Congress in the November elections.

A suspension of the federal gasoline tax of 18.4 cents per gallon and the diesel tax of 24.4 cents would require congressional approval, likely making Biden’s speech largely symbolic. Read more

THE LEGISLATIVES OPPOSE

Lawmakers from both parties have expressed resistance to the suspension of the tax, with some Democrats, including House Speaker Nancy Pelosi, worrying the move will have a limited effect on prices if oil companies and retailers pocket a large part of the savings.

Peter DeFazio, a Democrat and chairman of the House Transportation and Infrastructure Committee, said Wednesday that a federal gas tax holiday would provide “minimal relief” while digging a fiscal hole in a tax fund. earmark for highways needed to repair crumbling bridges and build a modern infrastructure system.”

Biden has asked Congress to suspend the fuel tax until September, a move that will cost the Highway Trust Fund about $10 billion in lost revenue, but could be offset by other areas of a budget that sees the incomes rise and deficits shrink as the United States emerges. of the COVID-19 pandemic.

Some states, like New York and Connecticut, have already suspended fuel taxes, while others have floated ideas such as consumer rebates and direct relief.

Refiners are struggling to meet global demand for diesel and gasoline, exacerbating high prices and deepening shortages. Read more

“Suspending the federal gasoline tax will certainly provide short-term relief to American drivers, but it will not solve the root of the problem – the imbalance between supply and demand for petroleum products,” a spokesperson said. of the American fuel and petrochemical manufacturing industry. the group said.

Longer-term policies are still needed to boost energy production in the United States, he said.

U.S. pump prices are averaging close to $5 a gallon as rising demand for fuels coincides with the loss of about 1 million barrels per day of processing capacity. Over the past three years, many factories have been closed as demand for fuel skyrocketed at the height of the pandemic. Read more

Biden said he understands the politics around Republicans seizing on high gas prices ahead of the election, but he asked his rivals if they would have chosen not to support Ukraine instead.

“So to all those Republicans in Congress who are criticizing me today for high gas prices in the United States: are you saying we were wrong to support Ukraine? Are you saying we were wrong to stand up to Putin? Are you saying we’d rather have lower gas prices in America and Putin’s iron fist in Europe? I don’t believe it “, said Biden.

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Reporting by Jarrett Renshaw; additional reporting by Katharine Jackson; Editing by Susan Heavey, Nick Zieminski and Grant McCool

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