President Trump issues executive order on emergency diesel tax relief
President Donald J. Trump issued an executive order Oct. 5 on emergency tax relief for diesel fuel.
In the order he wrote, “Farmers and truckers are essential to the American way of life. Restricted global diesel supply has led to rising prices, and these key industries have been particularly hard hit,” Trump said. “While my administration has already undertaken historic efforts to ensure fuel affordability for our citizens, it is clear that further temporary relief is necessary.”
To implement the relief, Trump directed the secretary of the Treasury to use his authority to defer certain diesel fuel tax payment obligations and to provide penalty relief to the extent permitted by law. He also directed the secretary of agriculture and secretary of transportation to facilitate implementation of the policy.
“This targeted action will put money directly in the pocket of American farmers, truckers, and workers, to support their vital service to our nation,” he wrote.
The order also deferred certain excise tax payments and provided penalty relief. Within five days of the order, the secretary, in consultation with the secretary of war, as appropriate, “shall determine whether relief is authorized under 26 U.S.C. 7508A, including whether a qualifying event has occurred and which taxpayers have been affected by that event. If the secretary makes those determinations, the secretary shall, to the extent authorized by law, defer payment by those taxpayers of the taxes imposed by 26 U.S.C. 4041(a)(1)(A) or by 26 U.S.C. 4041(b)(1)(B) and that are incurred during the period of Oct. 5, 2026, through Dec. 31, 2026.”
The order also states that within five days, the “Secretary shall direct the Internal Revenue Service to announce that it will not impose a penalty under 26 U.S.C. 6715 (a)(1) or 26 U.S.C. 6715 (a)(2), when dyed diesel fuel is sold for use or used on the highway during the period of [Oct. 5, 2026, through Dec. 31, 2026]. The announcement shall also address relief from penalties for failure to make semimonthly deposits of that tax.”
The secretary shall issue guidance on implementation of this order and identify the specific relief being granted and “any conditions on such relief; the legal basis for relief, covered taxpayers, persons, locations, acts, liabilities, and deadlines; the beginning and ending dates of each applicable period; the date by which postponed taxes must be paid.”
Avenues, including legislation to eliminate the obligation to pay the amounts deferred, are being evaluated. The administration is also evaluating how fuel compliance resources will be allocated.
U.S. Secretary of Agriculture Brooke Rollins issued her own statement on the executive order and said the action is expected to represent approximately $640 million in combined federal and state savings across about 224.6 million harvested acres.
“President Trump is the most pro ranching and farming president in our lifetime,” she said in a news release. “Energy dominance is at the core of putting farmers and ranchers first.”
Rollins said the administration has unleashed American energy dominance, making the U.S. the largest energy producer in the world.
“While the administration has structurally changed the energy sector to secure the long-term future of agriculture, we are now taking steps to deal with short-term pressures impacting our American farmers,” she said.
Rollins said she hopes the order will “better enable our farmers to deliver America’s harvest during this critical time.”
Kylene Scott can be reached at 620-227-1804 or [email protected].
