Gas Prices Relief Act of 2026

Overview

• Bill: H.R. 8572, Gas Prices Relief Act of 2026
• Purpose: Establish a gasoline tax holiday for 2026, removing federal gasoline taxes for a defined period and directing transfers to highway and spill/storage trust funds to offset revenue losses.
• Sponsor: Rep. Josh Harder (with Rep. Kim Schrier as co-sponsor)

Main goal

• Provide immediate, temporary relief on gasoline prices by eliminating the federal gasoline tax for gasoline removed, entered, or sold from enactment through December 31, 2026.
• Ensure affected trust funds (Highway Trust Fund and Leaking Underground Storage Tank (LUST) Trust Fund) are funded through redirected sources to offset the loss of tax revenue.

Key provisions

1. Tax Holiday (Section 2)

   • Effective period: On or after enactment through January 1, 2027.
   • Tax change: The federal gasoline tax rate under Internal Revenue Code section 4081(a)(2)(A)(i) is set to zero for gasoline during the covered period.
   • LUST financing: The Leaking Underground Storage Tank Trust Fund financing rate under IRC section 4081(a)(2) is suspended for gasoline taxed under the zero rate.

2. Transfers to Trust Funds (Section 2, subsection (b))

   • General mechanism: The Secretary of the Treasury must transfer funds from the General Fund to:
     • Highway Trust Fund (HTF) under IRC 9503(a)
     • Leaking Underground Storage Tank (LUST) Trust Fund under IRC 9508(a)
   • Amounts: Equal to the reduction in amounts that would have been credited to each Trust Fund absent the tax holiday.
   • Coordination rules:
     • For the LUST Trust Fund: Transfers are treated as taxes received attributable to the LUST financing rate for certain Internal Revenue Code purposes (sections 9503(b)(1), 9508(b)(2)).
     • For the HTF: Transfers are treated as taxes received not attributable to the LUST financing rate.

3. Benefits to Consumers and Enforcement (Section 2, subsection (c))

   • Policy intent: Consumers should immediately benefit from the tax reduction, and transportation fuel producers and dealers should reduce prices accordingly.
   • Enforcement: Treasury authorities may be used to ensure consumers receive the tax-reduction benefits.

Who is affected

• Domestic gasoline consumers: Direct effect is temporary price relief due to a 0% federal gasoline tax during the effective window.
• Fuel producers and dealers: Expected to lower wholesale/retail prices to reflect the tax holiday.
• Highway and LUST Trust Funds: Financed temporarily through redirected General Fund transfers to offset revenue losses caused by the tax holiday.
• Government: Treasury Department role to execute transfers and enforce price reductions; coordination with Trust Funds’ statutory financing mechanisms.

Timing and procedural aspects

• Introduction date: April 29, 2026
• Referral: Committee on Ways and Means
• Effective period: Enactment date through December 31, 2026 (tax holiday applies to gasoline removed, entered, or sold on or after enactment and before January 1, 2027)
• No explicit sunset beyond the stated period; the text targets January 1, 2027 as the end date.

Notes

• The bill does not specify a replacement funding mechanism beyond temporary transfers from the General Fund to HTF and LUST Trust Fund.
• The bill emphasizes immediate price relief and enforcement to ensure consumer benefit, rather than long-term structural changes to fuel taxation.