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How much could you pay at the pump if federal gas tax holiday passes?

Posted at 9:12 AM, Jun 23, 2022
and last updated 2022-06-23 13:29:59-04

NASHVILLE, Tenn. (WTVF) — President Biden is wanting a Federal Gas Tax Holiday, meaning we would not have to pay for the current tax that sits around 18 cents.

The big question is, how much of an impact does it make?

The average tank size is about 13 gallons and the federal gas tax is about 18 cents, meaning you would save about $2.40 every time you fill up.

CBS News reports energy experts are saying it might not do much in terms of lowering prices. They are cautioning boosting demand for gas with supplies here at home constrained and inflation being an issue could mean the price going up in the long term.

Here in Tennessee, Governor Lee has said he will not issue a gas tax holiday.

"A temporary gas tax holiday would not necessarily guarantee a price reduction for Tennesseans, as the gas tax is paid by fuel distributors and not by consumers," the Governor's Office said in a statement.

If he did, Tennessee's gas tax is 27 cents a gallon...you would save about $3.50 per fill up with an average sized tank.

Governor Lee's Office said more people will benefit from a grocery tax holiday.

"Suspending state and local grocery tax is the most effective way to provide direct relief for Tennesseans," the statement said.

That will be in effect for the month of August.

We did some digging to see if that is true.

2020 data from the Bureau of Labor Statistics said the average family spends $411 per month on groceries.

Losing the 4% state grocery tax would be about $16.00 in savings for the month plus more by adding the local food tax in your county.

That means it would be a couple bucks more than what a state gas tax break would give you.

On top of that, the state is waiving the annual vehicle registration fee for one year starting July 1. It saves you about $24 if it's for a car or motor home.