Dry Treasury. Janet Yellen says federal gas tax suspension is on the table as Governor Polis pushes idea
In Denver to highlight the impacts of the Biden administration’s COVID-19 relief bill, Treasury Secretary Janet Yellen on Friday raised the possibility that the administration would push for a temporary suspension of the federal tax on petrol.
It’s something Colorado Democratic Governor Jared Polis urged congressional leaders to consider in the wake of Russia’s invasion of Ukraine.
“We’re looking at a range of things we could do to provide gas tax relief to consumers,” Yellen said Friday at the Mi Casa Resource Center west of Denver.
Yellen did not fully commit to the idea. The administration fears the move will benefit oil companies more than consumers in times of supply shortages. The pressure on supply can be attributed in part to President Joe Biden banning imports of Russian oil as part of the country’s ongoing military offensive in Ukraine.
Polis stood next to Yellen on Friday. Governor, Second Gentleman Doug Emhoff and a handful of Denver officials appeared at the resource center to discuss the American Rescue Plan Act, the bill the Biden administration pushed last March to fuel economic recovery of the country after the COVID-19 recession. . Mi Casa received $325,000 in support through this legislation, granted by the City of Denver.
The economy is growing and the federal unemployment rate fell to 3.8% in February. But Yellen acknowledged that inflation is a problem. The Federal Reserve’s efforts to combat that through higher interest rates could trigger a recession, but Yellen is confident the Fed can avoid that outcome, she said.
Polis was asked Friday what he would like to see federal officials do to ease the price burdens on Coloradans, and he mentioned a federal gasoline tax exemption that he and five other governors support. The group supports legislation that would suspend federal taxes until the end of the year. The 18.3 cents per gallon tax supports the Federal Highway Trust Fund.
Gas prices are climbing across the country, including in Colorado, where the average price hit $3.75 a gallon on Monday, according to AAA. This is the highest fuel price in the state since June 2013. AAA predicts Colorado is on track to eclipse its all-time gas price record of $4.09 per gallon, set in 2008 .
Polis is set to delay a 2-cent-per-gallon gasoline tax that was set to take effect in Colorado this year, as part of its efforts to cut costs for state residents in a variety of ways.
“We are really looking at everything we can do as a state to reduce costs, and I certainly encourage the federal government to do the same to alleviate some of this pressure that people are feeling due to the increase in costs. costs,” he said on Friday.
Yellen pointed out that the spike in gas prices can largely be attributed to the Russian-Ukrainian war and the economic ripple effects of international sanctions against Russia.
“The worst impacts are on Russia itself, which is our intention, but there are spillovers to the United States and other countries,” Yellen said. “It’s inevitable, and I think the American people understand the importance of taking a toll themselves in order to uphold the values that we hold dear and that we believe are fundamental to a peaceful world order.”