As fuel prices rise in Italy, Prime Minister Giorgia Meloni announced that the government is considering implementing a flexible mechanism to reduce fuel duties. This proposal comes as a response to the recent expiration of a temporary diesel tax reduction, which had lowered duties by 6.1 cents per litre but ended earlier this week. In the aftermath, fuel prices have increased, with Eni, a major energy company, raising the maximum diesel price at its stations from €2.19 to €2.25 per litre, while the cap for unleaded petrol stayed at €1.99 per litre.
The proposed mobile excise-duty mechanism aims to link fuel tax reductions to the additional VAT revenue generated when fuel prices increase. This would allow part of the extra revenue to be used to offset the higher costs of fuel, potentially easing the financial burden on both households and businesses. The government is also encouraging energy companies and fuel retailers to temporarily cap prices to mitigate the impact on consumers.
Since September, the government has accumulated approximately €170 million, which could be used for further measures to address the rising fuel costs. Officials are currently evaluating whether these funds should be deployed immediately or reserved for future use.
In addition to considering the new tax mechanism, the government plans to monitor the effectiveness of the existing fuel price caps. This observation will help determine the next steps in managing the situation, ensuring that any measures undertaken effectively contain prices and alleviate pressure on consumers.