Biden says he will decide on federal gas tax holiday 'by the end of the week'

President Joe Biden said Monday that he hopes to make a decision about a gas tax holiday by the end of the week, as the administration looks for ways to ease record fuel prices in a midterm election year.

Biden said he is considering a pause on the federal gas tax, which some lawmakers in his party have pushed as a way to reduce prices at the pump for Americans.

"Well, I hope I have a decision based on the data I'm looking for ... by the end of the week," Biden said Monday on vacation in Rehoboth Beach, Delaware.

The gas tax adds 18.4 cents total per gallon of gasoline – 18.3 cents in excise tax plus 0.1 cent in a storage fee. For diesel, it is 24.3 cents plus the 0.1 cent fee. The national average price for a gallon was $4.981 on Monday, according to AAA.

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Biden administration officials suggested Sunday that the administration could suspend the federal tax gas. Treasury Secretary Janet Yellen told ABC's "This Week" that it's "an idea that’s certainly worth considering," and Energy Secretary Jennifer Granholm said on CNN's "State of the Union" that the idea was under evaluation.

"Part of the challenge with the gas tax, of course, is that it funds the roads, and we just did a big infrastructure bill to help fund the roads," Granholm said.

"If we remove the gas tax, that takes away the funding that was just passed by Congress to be able to do that," she said.

Biden said he talked Monday morning with Larry Summers, Treasury secretary in the Clinton administration and economic adviser in the Obama administration, who has raised alarm about a potential recession as the Federal Reserve raises interest rates to tame inflation.

“There’s nothing inevitable about a recession,” Biden said.

Summers blamed spending from Biden’s $1.9 trillion American Rescue Plan, passed in 2021, for fueling inflation and blasted the idea of a gas tax holiday as “shortsighted, ineffective, goofy and gimmicky.”

Biden said members of his administration plan to sit down this week with CEOs of oil companies and seek “an explanation how they justify making $35 billion” during the first quarter of 2022.

The president expressed optimism that he will find support in Congress to lower health care costs, including capping the cost of insulin at $35 – one piece of his domestic agenda that stalled this year.

“I think we’re going to be able to get a change in Medicare and a reduction in the cost of insulin,” Biden said.

Biden said he wants to increase taxes on corporations to pay for the proposals, but his plan to overhaul the tax system has faced resistance in the evenly divided Senate.