How much monthly revenue would the federal government lose under Trump's proposed gas tax holiday, and what is the estimated net fiscal impact?

According to the Committee for a Responsible Federal Budget’s March estimate cited in the article, suspending the federal gasoline and diesel tax would cost the federal government about $3.5 billion a month in lost revenue. While approximately $1 billion a month of that loss would be offset by increased taxes elsewhere due to economic stimulus effects, the committee notes this would be more than outweighed by additional debt service costs from deficit expansion.

What is the primary purpose of the federal gas tax, and why is its current structure considered flawed?

The federal gas tax functions as a user fee to finance the US Highway Trust Fund, which pays for construction and repair of interstate highways, roads, and bridges. However, the tax has not been increased since the 1990s, and drivers of fuel-efficient vehicles—including electric vehicles—are effectively exempt, undermining the user-fee principle; as a result, about 80% of the Highway Trust Fund’s revenue still comes from the gas and diesel taxes, requiring periodic congressional infusions of general fund revenue to sustain it.

Trump’s Gas Tax Holiday Would Cost $3.5 Billion a Month

May 11, 2026

President Trump proposes suspending the federal gasoline and diesel tax to alleviate consumer costs amid an international energy crisis. Budget analysts estimate this policy would cost the government $3.5 billion monthly while providing minimal relief at the pump.

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