As diesel prices rise, the Italian government is exploring a flexible mechanism to reduce fuel duties, according to Prime Minister Giorgia Meloni. The proposal aims to alleviate the financial strain on households and businesses caused by increasing energy costs. This consideration follows the expiration of a temporary diesel tax reduction, which had gradually lowered duties to 6.1 cents per litre before ending on Tuesday.
In the wake of the measure’s expiration, fuel prices have surged, with Eni, a major energy company, raising the maximum diesel price at its petrol stations from €2.19 to €2.25 per litre. The price cap for unleaded petrol remains at €1.99 per litre. The government has urged energy companies and fuel retailers to maintain temporary price caps to mitigate the impact on consumers.
The proposed mobile excise-duty mechanism would link fuel tax reductions to additional VAT revenue generated when fuel prices increase. This would enable the government to use a portion of the extra revenue to counterbalance higher fuel costs. Meloni noted that since September, the government has accumulated approximately €170 million, which could be used for further measures, though officials are still deciding whether to deploy these funds immediately or reserve them for future use.
Additionally, the government plans to monitor the effectiveness of the current fuel price caps in containing prices before determining further actions. This approach reflects an effort to balance immediate relief with long-term fiscal planning, as Italy grapples with the rising cost of energy.