Fuel Tax Holidays Gain Momentum as States Look to Ease Rising Costs

States have long used sales tax holidays to provide temporary tax relief and encourage consumer spending. While back-to-school items, disaster preparedness supplies, and energy-efficient products are the traditional focus of these tax-free periods, states are increasingly turning to fuel tax relief to address economic pressures as fuel prices remain a concern.

These measures are intended to provide immediate relief to consumers, businesses, and industries facing higher fuel expenses. Here are the most recent efforts from states:

• Indiana suspended its gasoline use tax beginning April 8, 2026, after Governor Mike Braun declared an emergency and cited the ongoing conflict in Iran and disputes affecting the Strait of Hormuz. The 30-day suspension was subsequently extended through November 4, 2026. (Ind. Exec. Order No. 26-28 (Sept. 30, 2026), available at in.gov.)
• Ohio enacted a 90-day gas tax holiday from October 4, 2026, to January 2, 2027. Governor Mike DeWine signed House Bill 519, temporarily suspending gasoline and diesel fuel taxes to ease rising fuel costs tied to ongoing geopolitical tensions. (Ohio Motor Fuel Tax Holiday Act, H.B. 519, 136th Gen. Assem. (Ohio 2026) (enacted), available at ohio.gov.)
• Georgia suspended its motor fuel excise tax from September 29 – October 29, 2026. Governor Brian P. Kemp issued Executive Order 09.28.26.01 in response to market volatility and temporarily suspended commercial vehicle weight limits to help reduce transportation costs. (Ga. Exec. Order No. 09.28.26.01 (Sept. 28, 2026), available at gov.georgia.gov.)

Some states have also implemented targeted fuel tax relief measures to support agricultural producers during harvest season. In North Dakota, Governor Kelly Armstrong issued Executive Order 2026-08, effective September 29 – November 30, 2026, allowing farmers to use lower-taxed red-dyed diesel fuel in licensed commercial and highway vehicles for harvest-related transportation. The fuel is taxed at just 4 cents per gallon, compared to the state’s 23-cent-per-gallon highway diesel excise tax (N.D. Exec. Order No. 2026-08 (Sept. 29, 2026), available at governor.nd.gov.). Similarly, Texas temporarily authorized expanded use of the same diesel fuel from September 28-October 28, 2026, following a disaster proclamation related to diesel fuel shortages. (Tex. Gov. Proclamation (Sept. 28, 2026), certifying a diesel fuel shortage disaster, available at gov.texas.gov.)

Sales tax holidays continue to evolve beyond their traditional focus, with fuel-related relief becoming an increasingly common response to economic and industry-specific challenges. To keep track of current and upcoming sales tax holidays across the country, visit the Sales Tax Institute’s Sales Tax Holiday Chart for the latest developments and effective dates.