Trump Order Expands Access to Tax-Free Diesel

President Donald Trump signed an executive order deferring federal tax payments on red-dyed diesel through December 31st to help lower surging fuel prices for farmers and truckers. Because red-dyed diesel is normally restricted to off-road machinery, the order waives federal highway penalties and directs the USDA to stabilize local supplies.Â
In step with the White House, Iowa Governor Kim Reynolds signed a state emergency proclamation suspending Iowa’s penalty enforcement through February 2, 2027. This allows local haulers to transport corn, soybeans, livestock, and fertilizer on public roads using tax-free fuel—combining state and federal tax breaks for up to 59 cents per gallon in savings. However, experts warn that supply chain bottlenecks for dyed diesel could limit availability and potentially drive prices right back up.
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