Trending Now - Americans Expected to Spend Larger Tax Refunds on Gas

WHO:

President Donald Trump, chief of policy Alex Jacquez from Groundwork Collaborative, Neale Mahoney, director of the Stanford Institute for Economic Policy Research, Julie Margetta Morgan, president of The Century Foundation, Bernard Yaros and Michael Pearce, economists at Oxford Economics.

WHAT:

Trump stated, “Next spring is projected to be the largest tax refund season of all time.”

The nationwide average price of gas reached $3.94 on March 19th, 2026, up more than a dollar from just a month earlier.

Average tax refunds through March 6th, 2026, were $3,676, up $352 from $3,324 in 2025.

The average household is expected to pay $740 more in gas this year, nearly equal to the $748 increase in refunds estimated by the Tax Foundation.

Economists at Oxford Economics estimate that if gas prices average $3.70 a gallon all year, it will cost consumers about $70 billion, exceeding the $60 billion in increased tax refunds.

The U.S. economy is forecasted to grow just 1.9% in 2026, down from an earlier estimate of 2.5%.

WHERE:

Washington, D.C., United States.

WHEN:

The Iran war began on February 28th, 2026.

Data from the Bank of America Institute was released on March 17th, 2026.

The week ended on March 14th, 2026.

WHY:

Spiking gas prices are expected to consume tax refunds, leaving most Americans with little extra to spend.

The energy shock is predicted to impact lower and middle-income households more severely, as they receive lower refunds and spend a greater proportion of their earnings on gas.

HOW:

Economists refer to the phenomenon of gas prices declining more slowly than they rise as the “rocket and feathers” phenomenon.

Consumers are reportedly maxing out credit cards and using “buy now, pay later” options to purchase groceries.

(UPDATED March 22, 2026 13:19 UTC)

In a press conference today in Washington, D.C., Trump announced that next spring is projected to be the largest tax refund season of all time, with average refunds already up to $3,676 this year. However, the nationwide average price of gas has surged to $3.94, leading to an expected $740 increase in household gas expenses, which could consume much of those tax refunds, particularly affecting lower and middle-income families. Economists warn that if gas prices remain high, the financial strain could cost consumers about $70 billion, overshadowing the estimated $60 billion increase in tax refunds.