President Donald Trump said on Monday that he will reduce or suspend the federal gasoline tax for an undetermined period.

The move aims to provide immediate financial relief to consumers as fuel prices rise sharply due to the ongoing war with Iran. Because gasoline is a primary cost for most American households, a reduction in the federal tax could lower the price per gallon at the pump.

Trump addressed the issue on May 11, and said that the tax would be lowered until the situation is appropriate. "I will reduce the 18-cent federal gas tax for a yet-to-be-determined period," Trump said.

The current federal gasoline tax is reported as 18 cents per gallon [1], though some records indicate the figure is 18.4 cents per gallon [2]. Trump said he is open to a full suspension of the levy to mitigate the impact of the energy crisis. "Yes, I would suspend the federal gas tax," Trump said.

While the president did not provide a specific timeline for when the tax would be reinstated, he said that the measure would remain in place until it is appropriate. "I want the federal gas tax suspended until it's appropriate," Trump said.

Such a policy change would lead to a significant decrease in government revenue. Estimates suggest that suspending the tax would result in a loss of billions of dollars [3] for the federal budget. These funds are typically used for infrastructure, and highway maintenance across the U.S.

Despite the potential for revenue loss, the administration is prioritizing the reduction of fuel costs to stabilize the economy during the geopolitical conflict.

“"I will reduce the 18-cent federal gas tax for a yet-to-be-determined period."”

This proposal represents a direct intervention in the energy market to offset the inflationary pressure caused by the war with Iran. By targeting the federal excise tax, the administration seeks a quick win for consumers that does not require legislative approval for a tax holiday, though the resulting multi-billion dollar revenue gap may create future funding shortfalls for national infrastructure projects.