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U.S. President Donald Trump has signed a measure temporarily permitting red-dyed diesel on American roads and postponing federal excise tax payments, according to the White House. Trump announced the initiative at a rally in Nebraska, saying it was intended to lower fuel costs.

Red-dyed diesel is normally sold tax-free for off-road uses, including farming and construction. The measure directs the Treasury Department to defer federal excise tax payments on its road use until the end of the year, without interest or penalties. It also calls for examining options to eliminate the deferred tax liabilities, rather than immediately canceling them.

The Transportation Department will coordinate access to the fuel with states, industry representatives and labor organizations. The Agriculture Department was instructed to safeguard supplies for farmers in areas with high demand and encourage states to adopt similar measures.

The White House said the initiative aims to reduce fuel costs for farmers, truck drivers and workers. The federal diesel tax is 24.4 cents per gallon, equivalent to about $60 for a 250-gallon fill-up. Savings could exceed $100 per fill-up if states take matching action. Diesel used on public roads is normally subject to both federal and state excise taxes.

Key Takeaways

• The measure temporarily permits red-dyed diesel on public roads.
• Federal tax payments are deferred until year-end without interest or penalties.
• Truckers could save more than $100 per fill-up if states adopt matching measures.