As Iran war drives up fuel prices, states are hesitant to suspend gas tax

Politics As Iran war drives up fuel prices, states are hesitant to suspend gas taxes. Here's why. By Kathryn Watson Kathryn Watson Politics Reporter Kathryn Watson is a politics reporter for CBS News Digital, based in Washington, D.C. Read Full Bio Kathryn Watson April 16, 2026 / 6:00 AM EDT / CBS News Add CBS News on Google Washington — As fallout from the war with Iran keeps fuel prices high, few states are making moves to suspend their gas and diesel taxes. Tax policy experts say suspending the state and federal motor fuel taxes wouldn't be as effective in lowering prices at the pump as one might think, and could come at a cost to the roads and bridges that drivers depend on.The average state gas tax is 32.6 cents per gallon, according to the U.S. Energy Information Administration. The average gas price in the U.S. on Wednesday was $4.11, according to AAA, and 51% of respondents in a recent CBS News poll said gas prices have posed a financial hardship or been financially difficult for them.Only a few states have taken steps to mitigate their motor fuel taxes since the conflict in the Middle East began. Georgia became the first state to suspend its motor fuel tax last month, with Republican Gov. Brian Kemp signing a 60-day suspension on the state's 33-cent-per-gallon gas tax and 37-cent-per-gallon diesel tax. On April 8, Indiana's Republican Gov. Mike Braun issued an executive order for a 30-day suspension of that state's 7% gasoline sales tax. And Utah temporarily reduced its state fuel tax, but only by 6 cents on the gallon, bringing its state gas tax to 32 cents on the gallon for the remainder of 2026. Kemp, who signed the gas tax suspension as a part of a bill sending state income tax refunds back to taxpayers, said he was proud to "deliver meaningful tax relief" to Georgians. Georgia House Speaker Jon Burns said the gas tax suspension would save drivers "nearly $400 million over the next 60 days."But most states have been hesitant to suspend t...