Trump touted bigger tax refunds this year, but Americans will likely spend them on gas

A person fills up her vehicle's gas tank at a gas station in Buffalo Grove, Ill., Thursday, March 19, 2026. (AP Photo/Nam Y. Huh) 2026-03-22T10:25:48Z WASHINGTON (AP) — The U.S. economy was supposed to start the year with a bang , fueled by an unusually large jump in tax refunds from President Donald Trump’s tax cut legislation. Yet spiking gas prices are on track to eat up those refunds, leaving most Americans with little extra to spend. “Next spring is projected to be the largest tax refund season of all time,” Trump said in a prime-time speech in December that was intended to address voters’ concerns about the economy and stubbornly high prices. But that was before the Iran war , which began Feb. 28. Oil and gas prices have soared since then, with the nationwide average price of gas reaching $3.94 Sunday, up more than a dollar from just a month earlier. Gas prices are likely to remain elevated for some time, even if the war ends soon, because shipping and production have been disrupted and will take time to recover. Economists now expect slower growth this spring and for the year as a whole, as dollars that are spent on gas are less likely to be used for restaurant meals, new clothes, or entertainment. Lower and middle-income households are likely to be hit particularly hard, because they receive lower refunds, while spending a greater proportion of their earnings on gas. “The energy shock is to going to hit those who have the least cushion,” said Alex Jacquez, chief of policy at the left-leaning Groundwork Collaborative and a former economist in the Biden White House. “And it doesn’t look like those tax refunds are going to be here to save them.” Neale Mahoney, director of the Stanford Institute for Economic Policy Research, calculates that gas prices could peak in May at $4.36 a gallon, based on oil price forecasts by Goldman Sachs, followed by slow declines for the rest of the year. The notion that gas prices decline much more slowly than they rise is so

原文链接: AP News