Congress Proposed Tax Cuts to Offset Fuel Costs

New legislative proposals aim to lower commuting expenses and suspend federal fuel taxes through the end of the year.

Updated on Sept. 30, 2026 in Taxes

Congress Proposed Tax Cuts to Offset Fuel Costs

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Do you support federal legislative efforts to lower fuel costs through tax breaks and export restrictions?

Lawmakers have introduced several bills designed to provide financial relief to households as gas and diesel prices remain elevated due to global supply disruptions. These proposals include an above-the-line tax deduction for commuting and the suspension of federal fuel excise taxes.

Why it matters

Rising energy costs have increased the financial burden on households, prompting legislative efforts to lower personal expenses ahead of the midterm elections. These proposals aim to improve disposable income by reducing direct costs at the pump and providing new tax write-offs for commuters.

Regular unleaded gas averaged $4.48 per gallon and diesel $6.53 as of September 29, 2026. Proposed legislation would remove the 18.4-cent gasoline excise tax and 24.4-cent diesel tax through the end of the year.

The players

Andy Harris

A member of Congress who proposed suspending federal excise taxes on gasoline and diesel to lower consumer costs.

Tim Burchett

A member of Congress who introduced legislation intended to restrict diesel exports to domestic markets.

The details

The proposed Lowering Commuting Costs Act would create an above-the-line deduction, allowing taxpayers to write off commuting expenses up to $4,080 for single filers or $8,160 for joint returns starting in 2027. Additionally, lawmakers have proposed suspending federal excise taxes on gasoline and diesel through December 31, 2026, to provide immediate price relief at the pump. Separate measures aimed at restricting diesel exports have also been introduced to stabilize domestic supply and price levels.

September 28, 2026: Bipartisan commuting tax deduction bill introduced.
September 29, 2026: National average gas price reached $4.48 and diesel hit $6.53.
November 3, 2026: Midterm elections scheduled.
December 31, 2026: Proposed tax suspension and deduction timeline ends.
January 2027: Proposed diesel export ban deadline.

Inflation
Sept. 18
National Gasoline Prices Rose to $4.46 Per Gallon
Inflation
Sept. 20
Diesel Prices Hit Record High of $6.49 a Gallon
Inflation
Sept. 21
Fuel Costs Have Risen Amid Global Energy Pressures

Money Landscape

These legislative efforts reflect a broader policy trend of utilizing tax code adjustments to address household affordability in the face of supply-driven inflation. The proposals are positioned to provide temporary relief as energy markets continue to navigate global supply constraints.

Households should monitor these proposals to understand potential changes to their 2027 tax planning and weekly fuel budgets. Consult a tax professional to evaluate how these potential deductions might interact with your specific financial situation if the legislation is enacted.

The takeaway

These proposals represent a significant attempt to leverage tax policy to provide immediate relief against elevated fuel prices. Taxpayers should keep an eye on upcoming legislative sessions and consult with a tax professional regarding how these changes could impact future tax filings.