As gas prices spike, Sen. Gallego urges IRS to raise mileage rate for business use of cars

Amid a spike in gas prices, Sen. Ruben Gallego is urging the IRS to raise the standard mileage rate for business use of automobiles.

The IRS rate, currently set at 72.5 cents per mile, is a standard used by many businesses to determine how much to reimburse employees for the miles spent driving on the job.

Gallego said he supports a variety of actions to lower gas prices, from ending the war in Iran to temporarily suspending the federal gas tax.

But raising mileage rates would provide the most immediate relief, he said.

“Could be your driver, your Uber driver, the people that are dropping off your food. Those people make money also from the mileage reimbursement. All the IRS has to do is issue an opinion and it goes up, you don't even have to pass a law,” Gallego said.

The Biden administration raised IRS mileage rates by 4 cents in 2022.

The Environmental Protection Agency recently granted fuel waivers that allow Arizona to use a cheaper fuel blend. Gallego says that should be a permanent change.

Arizona is limited to a summer fuel blend and a cheaper winter fuel blend. The winter blend is restricted for part of the year, because of concerns it may exacerbate smog.

“Most of our blend — requirement for the blend — is because of the bad air that comes in from Mexico, not because of our responsibility, anything we’ve done. There's no reason why Arizonans should be paying more for this very, very expensive blend,” Gallego said.

Gallego said since the fuel restrictions were adopted, cars have become more efficient and better for the environment, so letting gas stations use cheap fuel blends all year long won’t have a strong impact on air quality.