With gasoline prices nationwide expected to continue their upward surge in the wake of President Joe Biden’s ban on the importation of oil from Russia, Colorado Gov. Jared Polis on Tuesday reiterated his support for a temporary suspension of the federal gas tax.
In a joint letter to congressional leaders, Polis and five other Democratic governors urged passage of the Gas Tax Relief Act, legislation proposed last month by a group of Senate Democrats. The bill would suspend collection of the federal gas tax of 18.3 cents per gallon until Jan. 1, 2023.
“At a time when people are directly impacted by rising prices on everyday goods, a federal gas tax holiday is a tool in the toolbox to reduce costs for Americans, and we urge you to give every consideration to this proposed legislation,” the governors wrote.
Biden on Tuesday heeded bipartisan calls to ban the importation of Russian oil and gas in the wake of the country’s invasion of Ukraine, which had already sent shockwaves through global energy markets. The average price of a gallon of gasoline in the United States reached $4.17 on Tuesday, the highest level since 2008 and a 71-cent increase from just a month ago, according to AAA.
“With this action, it’s going to go up further,” Biden said of the import ban.
The Committee for a Responsible Federal Budget, a fiscally conservative nonprofit, estimated last month that the Gas Tax Relief Act would reduce federal revenues by $20 billion. The legislation would authorize the Treasury Department to replace the lost revenue to the government’s Highway Trust Fund, the majority of which is currently funded by gas taxes, with general fund dollars.
Polis first called on the federal government to “immediately suspend the federal gas tax” shortly after Russia’s invasion began last month. He has also called on state lawmakers in the General Assembly to delay implementation of a new 2-cent-per-gallon fee on gasoline purchases, a hike passed as part of a landmark transportation-funding package signed into law by Polis last year.
Unless adjusted by the Legislature, the fee is scheduled to take effect in July and rise incrementally to 8 cents a gallon by 2028, in addition to the state’s motor fuel tax of 22 cents per gallon. The federal gas tax has remained flat at 18.3 cents a gallon since it was last raised in 1993.
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