Red Diesel Decision to Lower Costs in the US
In the US, the temporary use of tax-free red-dyed diesel, used in agriculture and construction, has been permitted on highways.
US President Donald Trump signed a decree permitting the temporary use of red-dyed diesel on highways—which is used tax-free in off-road sectors like agriculture and construction to lower costs—and postponing the payment of the federal excise tax until the end of the year.
Step Announced at Rally
US President Donald Trump announced a new step to lower costs during a rally in Nebraska. He stated that red-dyed diesel fuel is preferred in vehicles used off-road, such as agricultural machinery and construction equipment. He noted that this fuel is identical to regular diesel but is sold tax-free.
Federal Excise Tax Postponement
According to an information memo shared by the White House, Trump signed the decree granting temporary permission for the use of red diesel on highways. The US Department of the Treasury was instructed to postpone the payment of the federal excise tax until the end of the year without interest or penalties. The decree also called for exploring options to eliminate the deferred taxes.
New Duties Assigned to Ministries
The US Department of Transportation was tasked with coordinating with states, industry representatives, and labor organizations regarding access to this fuel. The US Department of Agriculture was asked to ensure farmers have access to red-dyed diesel in areas where demand is high.
Expected Savings
This step aims to lower fuel costs for American farmers, truck drivers, and workers. It was noted that truck drivers could save over one hundred dollars with each refueling, while sharing the information that the federal diesel tax is 24.4 cents per gallon.