Trump Announces Order to Expand Access to Tax-Exempt Diesel

GRAND ISLAND, Neb.—President Donald Trump announced a new executive order aimed at lowering diesel prices during a boisterous rally in the nation’s heartland on Oct. 5 at the Nebraska State Fairgrounds in the Pinnacle Bank Expo Center.

“Tonight, I’m going to sign a historic executive order to officially waive the off-road requirement and allow anyone to purchase tax-free red-dye diesel,” Trump said to roaring applause from the standing-room only crowd.

The order directs federal authorities to expand access to tax-exempt diesel, the fuel used in tractors and off-road machinery which is dyed red to help law enforcement officials detect tax evasion if operators use the fuel for driving on roads.

Any purchase volume limits currently in place to limit red-dyed diesel sales will not be enforced, as per the order. 

The Treasury Department is instructed to review federal diesel taxes to identify potential opportunities to reduce costs, while the Transportation Department will negotiate with states about temporarily waiving road-diesel taxes.

Diesel prices are hovering just below $6 per gallon, on average, across the state as of Monday, according to motoring club AAA, down from a record high of $6.23 per gallon set on Sept. 22.

Nationally, diesel costs $6.32 per gallon, on average, after peaking at $6.53 per gallon last month.

The prices reflect a $2.63 increase for Nebraska and the nation compared to the same time last year.

Trump criticized California and other states that limited refinery capacity in tecent years.

Nebraska Gov. Jim Pillen declared a state-level emergency on Sept. 24, citing the distillate fuel shortage when signing two executive orders to reduce fuel costs for harvesting and hauling after diesel costs topped record highs.

“That was a bad day for Nebraska and Nebraska agriculture,” he said during the rally, noting the high-energy needs of the ongoing harvest season and the strain the higher prices put on farmers.

His orders are in effect until Dec. 23 unless further action is taken to codify the orders.

While the president floated the idea of a 90-day export ban to increase supply, requested by Pillen, Trump told reporters Oct. 2 that the move was unnecessary after G7 leaders agreed to release 100 million barrels of diesel.

The governor, who will face Democratic former Sen. Lynne Walz in the state’s gubernatorial election next month, emphasized Nebraskans’ family values and their commitment to community, traits he said would help people overcome business and financial challenges.

“So many people in this room know what it means to feed the world and save the planet,” Pillen said during the rally.

Thousands of supporters lined up hours before the door opened, and the line stretched more than a mile around the fairgrounds and down the street shortly before the program began.

The president highlighted heightened border security, stock market highs, lower drug prices, and tax reforms benefiting small businesses and families, among other achievements. He also touted military success in Venezuela, with the capture of Nicolás Maduro leadimg to renewed trade deals with the nation, which guarantees the United States 65 billion barrels of Venezuela’s oil reserves.

Trump was in the state generating support for Republicans across the board while also stumping for Pillen and Sen. Pete Ricketts (R-Neb.) in what recent polls suggest has turned into a close battle against independent candidate Dan Osborn.

Ricketts asked the crowd to turn out in force for the midterms to protect the party’s majority in the Senate, which hangs in the balance as races tighten across the nation, according to recent polling data.

Nebraska is the latest stop on Trump’s 32-day campaign tour, having visited Ohio, Alabama, Texas, and Oklahoma in recent days.