Gas prices hit $4. Here's what a gas tax holiday would do
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The average gas prices in Houston — and in Texas — hit $4 Wednesday, per AAA.
The big picture: Gas prices have been climbing for weeks, tied to the Iran war, but hitting the $4 mark lands hard for consumers already squeezed by higher costs.
- The national average reached $4.54 per gallon Wednesday, according to AAA, with analysts warning prices could keep rising.
Driving the news: The gasoline price surge is reigniting political chatter about suspending the federal tax on fuel to help consumers, thanks to a recent round of populist proposals from high-profile Democrats.
Reality check: It's one of those go-to ideas that often surfaces when prices climb.
- Congress would have to approve a suspension of the gas tax, and so far, it never has. But political winds could shift in these not-normal times.
By the numbers: The Bipartisan Policy Center notes that suspending the 18.3-cent-per-gallon federal gas tax would lower gas prices by 10 to 16 cents per gallon for consumers.
- But it wouldn't come close to offsetting the nearly $1.50-per-gallon gas price jump since the war started.
Zoom in: State Rep. James Talarico (D-Austin), who is running for U.S. Senate, is among the politicians pushing for a suspension of the federal gas and diesel taxes, saying it would save drivers $200 each year.
Meanwhile, Texas Agriculture Commissioner Sid Miller, a Republican, and state Rep. Gina Hinojosa, an Austin Democrat running for governor, last month called on Gov. Greg Abbott to suspend the state's 20-cent-per-gallon tax.
- "Texas families are getting hammered at the pump, and enough is enough. Record-high gas prices are crushing working Texans, farmers, and ranchers with every school drop-off, every tractor filled, and every grocery run," Miller said in a statement, noting Georgia, Indiana and Utah already have.
- "Washington needs to act to bring down gas prices, but right now, Greg Abbott has the power to make gas 20 cents cheaper for every Texan driving to work," Hinojosa said.
The other side: Abbott campaign spokesperson Eduardo Leal pushed back on the proposal, telling Axios the governor doesn't have the authority to pull the tax back.
- He adds: "That revenue generates well over $300 million per month, which is constitutionally dedicated to fund roads and public schools. Looks like Democrats want to defund Texas public schools, but I guess ignorance is bliss."
Editor's note: This story has been updated with new comments from a spokesperson for Abbott.