As prices soar, Walz reverses, calls for federal gas tax holiday

Walz has attempted to raise Minnesota's gas tax in the past. He once sought a 20-cent increase over two years.

Lorie Shaull/Flickr

In a tough reelection battle this year, Gov. Tim Walz is changing his tune on gas taxes.

The Minnesotan joined five other Democratic governors urging the U.S. Congress to suspend the federal gas tax amid soaring prices at the pump caused by Russia’s invasion of Ukraine and President Joe Biden’s ban on importing Russian oil this week.

“At a time when people are directly impacted by rising prices on everyday goods, a federal gas tax holiday is a tool in the toolbox to reduce costs for Americans,” Walz, along with Govs. Tony Evers (Wisc.), Michelle Lujan Grisham (N.M.), Jared Polis (Colo.), Gretchen Whitmer (Mich.), and Tom Wolf (Penn.), wrote in their letter.

They added that “money saved at the pump translates into dollars back in consumers’ pockets for groceries, childcare, rent, and more.”

The governors also claim the Biden administration’s $1-trillion hard infrastructure legislation provided nearly $120 billion to the Highway Trust Fund, meaning a federal gas tax pause would not inhibit summer road construction and bridge maintenance.

Interestingly, Walz has attempted to raise Minnesota’s gas tax in the past. He once sought a 20-cent per gallon increase over two years. Last year, House Democrats pursued a 5-cent gas tax hike.

Not so much this week.

The Gas Tax Relief Act would suspend the 18.3-cent per gallon federal gas tax until the end of 2022. The federal gas tax is not tied to inflation, which hit a 40-year high Thursday.

Minnesota has a 28.5-cent per gallon state tax, among the highest in America.

Walz said he’d consider pausing this, too.

“I am open to that,” the governor told reporters at the Capitol. “I think you target that, especially where it’s hurting folks the worst, maybe the summer driving season.”

A federal and state gas tax suspension combined could save Minnesotans more than 46 cents a gallon.

Minnesota Republican Party Chair David Hann dismissed Walz’s idea as “a laughable political stunt.”

“The governor and DFL legislators have always supported increasing, not reducing or pausing the gas tax in Minnesota,” Hann said in a statement. “Together they’ve proposed raising the gas tax on Minnesotans by 25 cents a gallon over the past few years. Now, they are suddenly concerned about rising prices — due to the shortages created by their policies to shut down oil production and distribution.”

The idea comes as fuel prices have soared to a national average of $4.31 per gallon and close to $4 per gallon in Minnesota, up roughly 60 cents — and 80 cents nationally — during the past four weeks.

The last time gasoline cost this much was nearly a decade ago when Minnesota prices very briefly spiked to an all-time high of about $4.25.