The President issued an executive order directing federal agencies to defer certain diesel fuel taxes and waive related penalties for affected industries. The document, signed Oct. 5, 2026, and released Oct. 9, 2026, states that the action aims to provide temporary relief to farmers and truckers facing restricted global fuel supplies and rising prices. The order directs multiple agencies to coordinate on implementing the changes.
The order requires the Treasury secretary, in consultation with the secretary of War, to determine within five days if tax deferral is legally authorized for specific taxpayers. If approved, the Treasury will defer the collection of specific diesel excise taxes incurred between Oct. 5, 2026, and Dec. 31, 2026. The order says these deferred payments will not accrue penalties, interest or additional amounts.
The Treasury secretary must also direct the Internal Revenue Service to announce a penalty waiver for the sale or highway use of dyed diesel fuel during the same period. The IRS announcement must address relief for taxpayers who fail to make semimonthly deposits of the tax. Additionally, the order instructs the Treasury to assess and publicly announce how the IRS will allocate its resources for vehicle fuel tank inspections during the relief window.
Under the directive, the Treasury must issue guidance specifying the covered taxpayers, locations, and the final deadlines for paying the postponed taxes. The order also directs the Treasury secretary to explore administrative and legislative avenues to permanently eliminate the obligation to pay the deferred tax amounts.
Other federal departments are tasked with facilitating the emergency policy. The agriculture secretary is directed to coordinate with farm supply organizations, agricultural cooperatives and rural distributors to ensure adequate distribution of dyed diesel in high-demand areas. The transportation secretary must engage with state governments and labor organizations while continuing all existing safety audits and inspections.
The order also directs the White House Office of Intergovernmental Affairs to engage with state governments and encourage them to adopt corresponding tax relief policies. The Department of Agriculture will bear the costs of publishing the order.