Why does President Joe Biden want to pass a federal gas tax holiday? Will N.J. suspend its gas tax?

Published: Jun. 22, 2022

President Joe Biden is calling on Congress to pass a three-month federal gas tax holiday to give Americans some relief at the pump.

However, people within his own party, including House Speaker Nancy Pelosi, D-Calif., are skeptical the move will provide much benefit to consumers.

Meanwhile, Biden is also urging states across the country to suspend their own gas taxes to help alleviate pain further.

But New Jersey leaders reiterated Wednesday it would be difficult to suspend the Garden State’s gas tax.

Here’s what you need to know:

Why is Biden calling on Congress to suspend the federal gas tax?

Biden asked federal lawmakers to lift the federal taxes — 18 cents on gasoline and 24 cents on diesel fuel — until the end of September.

“I fully understand the gas tax holiday alone is not going to fix the problem,” Biden said in remarks from the White House. “But it will provide families some immediate relief, give them a little bit of breathing room, so we continue working to bring down prices for the long haul.”

The move comes shortly before the 2022 midterm elections in November.

Why are other politicians, including Republicans and other Democrats such as Speaker Pelosi, skeptical about the plan?

According to The New York Times, Republicans widely oppose the measure because it undermines the energy industry.

But Biden has also faced pushback on his plan from members of his own party. Pelosi said companies would take up most of the savings, leaving little left for the consumers.

Why might New Jersey follow the federal government’s lead and suspend the state gas tax?

Murphy, a fellow Democrat, has repeatedly he supports a federal gas tax holiday but argued suspending New Jersey’s gas tax would be difficult.

“The reason why the feds can do it is: Quite simply, they can print money, and we can’t,” Murphy told reporters after an unrelated event in Red Bank on Wednesday. “We’re gonna continue to find other ways. We’re not done on affordability. We’re still at it.”

Murphy and other state leaders note suspending the state gas tax may not be feasible because it is constitutionally dedicated to funding transportation projects across New Jersey.

”You could do it. But here’s the problem: It’s constitutionally tied to infrastructure projects, which you’d have to stop. And when you restarted them, it would cost all of us, including taxpayers, more money,” Murphy said. “We’d rather do what we announced last week to deliver historic property tax relief to get money in people’s pockets in other ways.”

State Assembly Speaker Craig Coughlin, D-Middlesex, agreed.

”That funding is critically important to the growth and development of the state of New Jersey,” Coughlin said Wednesday. “That’s why we enacted it.”

There was also a study done in New Jersey in March that showed if the gas tax holiday was implemented on the state level, it would not be very effective in decreasing gas prices.

Both Democratic and Republican state lawmakers have introduced bills that would give rebates to residents to offset high inflation and gas prices. But none have received votes in the Democratic-controlled state Legislature.

Republicans have tried to force votes on a $500 rebate proposed by state Sen. Ed Durr, R-Gloucester, to no avail.

Murphy and Democratic leaders have instead pushed other ideas, including a property tax rebate program and a sales tax holiday on back-to-school supplies, announced Wednesday.

 

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published this page in News and Politics 2022-06-23 03:14:34 -0700