RELIEF AT THE PUMP?

Lawmakers want to cut gas taxes, but analysts question whether it will actually lower prices.

- SANDRA BLOCK

IF YOU’VE EVER DRIVEN ACROSS the U.S., you’ve probably noticed that while most gas stations charge the same price for a frozen burrito, the cost of a gallon of gas varies widely.

The price differences primarily reflect state gas taxes, which range from as little as 15 cents to more than 68 cents per gallon (see the box on page 10). And as drivers head out for summer vacations, they are likely to see even greater disparities at the pump when they cross state lines.

In response to record-high gas prices, lawmakers in Connecticut, Florida, Georgia, Maryland and New York have approved gas tax holidays, and bills have been introduced in at least a dozen more states that would temporarily suspend or reduce gas taxes. Meanwhile, Democrats in Congress have introduced legislation that would suspend the federal gas tax of 18.4 cents per gallon through 2022.

While the U.S. isn’t experiencing 1970s-style gas shortages, the spike in gas prices reflects constraints on supplies that have been aggravated by Russia’s war on Ukraine—and drivers will no doubt welcome any relief at the pump. But analysts say the actual savings from gas tax suspensions will likely be minimal, particularly where the federal gas tax is concerned. An analysis by the University of Pennsylvania’s Wharton School estimated that suspending the federal gas tax through December 2022 would save the average driver less than $50.