By 
Gas prices are averaging $4.52 per gallon nationally as of late May 2026, up more than 50% since the U.S.-Israel military operation against Iran began in late February. President Trump has floated suspending the federal gas tax to give drivers relief. Sen. Josh Hawley introduced a bill to suspend it for 90 days. The question most people are actually asking is: how much would this save me? The honest answer is less than you might hope.
What the Federal Gas Tax Is
The federal gas tax is 18.4 cents per gallon of gasoline and 24.4 cents per gallon of diesel. It has not been raised since 1993. Revenue from the tax funds the Highway Trust Fund, which pays for federal road and bridge maintenance. In 2026, the HTF is projected to collect $44.2 billion while spending $61.4 billion — already running a $17 billion deficit before any suspension.
Suspending the gas tax requires an act of Congress. The president cannot do it unilaterally. As of late May 2026, no legislation has passed.
How Much Would You Actually Save?
The federal gas tax is 18.4 cents per gallon. On a 16-gallon fill-up, that is $2.94 in savings per fill-up. The Peter G. Peterson Foundation estimates the average driver would save less than $9 per month from a federal gas tax suspension.
To put that in context: gas prices have risen roughly $1.54 per gallon since the Iran war began. Even with the full federal gas tax eliminated, you would still be paying $1.35 per gallon more than you were in January. The tax suspension does not solve the underlying problem — it reduces it by about 12%.
| Driver Type | Monthly Gallons | Monthly Savings | Annual Savings |
|---|---|---|---|
| Light driver (8,000 miles/yr) | ~23 gallons | ~$4.20 | ~$51 |
| Average driver (12,000 miles/yr) | ~40 gallons | ~$7.36 | ~$88 |
| Heavy commuter (20,000 miles/yr) | ~65 gallons | ~$11.96 | ~$144 |
| Truck driver (diesel) | ~200 gallons | ~$48.80 | ~$586 |
Diesel drivers and commercial truckers benefit significantly more than passenger car drivers. This is why the trucking industry tends to support gas tax holidays while consumer advocates note the savings are minimal for most families.
What States Have Already Done
While federal legislation works through Congress, several states have already suspended their own gas taxes, providing faster relief:
- Indiana: Suspended state gas tax — saving drivers 59 cents per gallon
- Georgia: Suspended state gas tax — saving drivers 33 cents per gallon
- Utah: Partial suspension — saving drivers 6 cents per gallon
State gas tax suspensions can be done more quickly through state legislatures and governor orders than federal legislation. If you live in one of these states, you are already getting relief. Check your state’s gas tax status — more states may act before a federal bill passes.
Why the Savings May Be Even Less Than the Math Suggests
Economic analysis of past gas tax holidays (including 2022 proposals and a 2000 Indiana suspension) consistently shows that gas stations and distributors capture some portion of the tax reduction rather than passing 100% of it to consumers. The White House stated that any suspension bill would hold oil companies accountable for passing savings to consumers, but enforcement mechanisms for this are notoriously difficult to implement.
The Tax Foundation’s Adam Hoffer summarized it: “This is a problem without an easy, short-run solution.” The supply disruptions driving prices up — Strait of Hormuz pressure, reduced Iranian output, energy market uncertainty — are not solved by a tax change.
What Actually Reduces Your Gas Bill Right Now
While the gas tax debate plays out in Congress, these moves reduce your fuel costs more immediately:
Use GasBuddy or the free Waze map. Gas prices vary by 20 to 40 cents per gallon within most metro areas. Spending two minutes finding the cheapest station near your route saves more than the proposed tax holiday per fill-up.
Pay with a cash-back credit card. Cards that earn 3-5% on gas purchases save 13 to 22 cents per gallon on a $4.52 average. That already beats the proposed federal tax suspension. The Wells Fargo Active Cash (2% everywhere), Chase Freedom Flex (special gas station offers), and Citi Custom Cash (5% on your top spending category, capped) are worth checking if you are not already using a card that earns on gas.
Drive smoother. Aggressive acceleration and hard braking can reduce fuel efficiency by 15-30% in city driving, according to the Department of Energy. Maintaining steady speeds and anticipating stops improves MPG and reduces cost per mile significantly — especially with gas above $4.
Check tire pressure monthly. Underinflated tires increase rolling resistance and reduce fuel economy by 0.5% to 3% per PSI below the recommended level. At $4.52 per gallon, a 3% efficiency loss costs about $0.14 per gallon — more than cumulative over a year than the proposed tax break.
Consolidate trips. Cold starts use more fuel than continuing a warm engine. Combining errands into one trip instead of multiple short outings meaningfully reduces your monthly fuel consumption.
Should You Change Any Financial Plans Around Gas Prices?
If you are thinking about buying a car and have been considering a hybrid or EV, the current $4.52/gallon environment makes the fuel savings math much more favorable than it was at $3/gallon. A Toyota Camry Hybrid averaging 52 MPG versus a standard Camry at 30 MPG saves roughly $550 per year in fuel at current prices — a meaningful factor in a purchase decision.
For your monthly budget, if you are a heavy driver, gas above $4.50 may require temporarily reducing discretionary spending to absorb the cost. Track your actual fuel spending for one month to know your real number before adjusting other budget categories.
Sources: AAA gas price data May 2026; Peter G. Peterson Foundation gas tax holiday analysis; Tax Foundation; CNBC Trump gas tax reporting May 2026; Department of Energy fuel economy tips. This article is for informational purposes only.
