Trump Signs Order Allowing Tax-Free Red Diesel on Highways During Grand Island Rally
Trump Signs Order Allowing Tax-Free Red Diesel on Highways During Grand Island Rally

Politics

Trump Signs Order Allowing Tax-Free Red Diesel on Highways During Grand Island Rally

President Trump signed an executive order at a Grand Island rally temporarily allowing tax-free red-dyed off-road diesel on highways, a move the White House says could save farmers and others on fuel costs.

President Donald Trump signed an executive order Monday night during a rally at the Grand Island, Nebraska, expo center that temporarily allows red-dyed off-road diesel to be used on highways and postpones federal excise tax payments on that fuel through the end of 2026, without interest or penalties.

“Today I’m announcing another unprecedented step to bring down costs,” Trump told the crowd. “For many years, farm vehicles, construction equipment, and other off-road vehicles have used what is known as red dye diesel. Tonight, I’m going to sign a historic executive order to officially waive the off-road requirement and allow anyone to purchase tax-free red-dyed diesel for any reason.”

Trump signed the document onstage after his executive assistant, Natalie Harp, brought it out at his request. “I’ll sign it right here!” he said.

Turning to Nebraska Sen. Pete Ricketts and Gov. Jim Pillen, who were in attendance, Trump said, “This should absolutely assure your election. I guarantee it.” He added, “You two guys were great. You stuck with us, and we have to. Otherwise, we’re not going to have a country anymore. So I appreciate it, and I’m going to sign this.”

He also joked, “I’m going to do what Joe Biden couldn’t do: sign his signature.”

What the order does

According to the White House, the federal excise tax on diesel is 24.4 cents per gallon, which amounts to roughly $60 on a 250-gallon fill-up. Officials said savings could top $100 per fill-up in states that adopt matching measures.

The order directs the Treasury Secretary, working with the Secretary of War, to defer the federal excise tax on highway use of dyed diesel through the end of the year without interest or penalties, and to look into ways to eliminate the deferred tax obligation altogether. It also instructs federal officials to coordinate fuel access and push states to take similar action.

Under existing rules, highway diesel carries both state and federal excise taxes, while off-road diesel used for farming, construction or heating is untaxed and dyed red so law enforcement can spot illegal highway use and issue penalties or back taxes.

The White House blamed high diesel prices and tight global supply on the Russia-Ukraine war and limited refining capacity, and also pointed to what it called “Democrat-led States that chose to shut down their refineries in the name of ‘Green Energy’ policies.”

Reaction from the region

Agriculture Secretary Brooke Rollins praised the move, estimating $640 million in savings for farmers. Vice President JD Vance called it “another example of President Trump acting quickly to tackle an urgent issue,” adding, “In this administration, we’re fighting every day to help hard working Americans, especially our farmers.”

Trump credited Nebraska’s Pillen and Ricketts along with Iowa gubernatorial candidate Zach Lahn for their work on the measure. “A lot of senators would not have been able to do what Pete was able to do,” Trump said, before mentioning Lahn.

Lahn said on X that he had raised the idea of the relief during a conversation with Vance.

The rally drew a large crowd to the Grand Island expo center, with OANN Chief White House Correspondent Daniel Baldwin describing the turnout as “outrageous” and writing on X that “the expo center is mobbed. Thousands of people outside. Americans were lining the streets during the motorcade.”

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