Road Tax Abolition Plan
Italy Proposes Abolishing Vehicle Tax for Millions Ahead of National Elections
Anonymous
Key Points
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Meloni’s conservative coalition is trailing the center-left in opinion polls and faces additional pressure from National Future, a new far-right party led by Roberto Vannacci that has been gaining support.
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Critics portrayed the tax measure as an inadequate response to the cost-of-living pressures: Roberto Vannacci aide Rossano Sasso said, “It’s like treating pneumonia with a throat lozenge.”
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Italy has already spent €2.8 billion to finance cuts to fuel excise duties, as fuel prices have risen for months amid supply disruptions linked in the article to the U.S. war against Iran.
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The measure was expected to be submitted to the cabinet for adoption on Wednesday, rather than being an immediately effective abolition at the time of the announcement.
Italy's Prime Minister Giorgia Meloni announced plans to abolish the vehicle ownership tax for 14.5 million cars and motorcycles starting in 2027, according to Wanted in Rome. The exemption would cover all motorcycles and over 70% of small and medium-sized cars, with a limit of one vehicle per person. Market Screener reports the move would cost the government €2.36 billion annually.
Meloni framed the elimination as relief from one of Italy's most unpopular taxes. Critics, however, called it a politically timed gesture ahead of next year's national election. Wanted in Rome noted the measure comes as Meloni's coalition trails in opinion polls and faces pressure from a rising far-right rival party.
A Bid to Reverse Slipping Poll Numbers
Meloni's conservative coalition is trailing the center-left in public support. Newscord reports she faces additional pressure from National Future, a new far-right party led by Roberto Vannacci that has been gaining traction. The road-tax announcement appears designed to shore up voter backing before the September election.
Vannacci's team dismissed the measure as inadequate. Wanted in Rome quoted aide Rossano Sasso saying the plan was like "treating pneumonia with a throat lozenge." He argued it fails to address broader cost-of-living pressures gripping Italian households.
Fuel Costs Already Draining the Budget
Italy has already spent €2.8 billion to cut fuel excise duties as prices climbed. Market Screener notes fuel costs have risen for months following supply disruptions tied to geopolitical tensions. The road-tax plan adds another major expense on top of existing spending.
The government has yet to clarify how it will finance the €2.36 billion annual cost. Mezha reports the exemption would run only from January through December 2027, a limited timeframe that raises questions about the plan's long-term viability and actual fiscal impact.
Cabinet Vote Expected, Debt Crisis Looms
The measure was expected to be submitted to the cabinet for adoption on Wednesday rather than taking immediate effect. Newscord reports Italy's public debt is projected to approach 139% of GDP, among the highest in Europe. Adding €2.36 billion in new spending raises fresh concerns about fiscal sustainability.
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