Giorgia Meloni’s government has dropped Italy’s annual road tax for about 14.5 million cars and motorbikes in 2027, a one-year holiday presented as relief for soaring fuel prices.
The cabinet approved the decree on September 16.
The exemption covers petrol, diesel and hybrid cars of up to 80 kW (109hp) and all motorbikes and mopeds.
That is more than 70 per cent of the car fleet, with 13.2 million cars and all two-wheelers.
Each person may claim it on only one vehicle, automatically the least powerful if they own more than one. Only individuals qualify.
Savings run from about €129 on a small new Euro 6 car to as much as €240 on older, thirstier models.
Bigger engines, second cars and company fleets stay liable.
Rome will compensate the regions because the bollo, the yearly ownership charge, is a regional tax. Officials put the bill at €2.36 billion, of which €2.293 billion goes to the regions and the autonomous provinces of Trento and Bolzano.
The funding comes largely from unused National Recovery and Resilience Plan money, the EU programme of grants and loans to member states to fund reforms and investments for green measures and digital transitions. The money is drawn from sums unspent on June 30, 2026 that carry no binding destination.
Petrol is around €2.13 a litre and diesel €2.24, lifted by disrupted supplies after the US war with Iran. Brent crude is trading near $110 a barrel.
The diesel relief has now been rolled over for the sixteenth time in a row, at a cumulative cost to the state of about €2.8 billion.
Meloni said that blanket pump subsidies no longer concentrate help where it is needed.
The latest diesel cut is being tapered: 12.2 cents a litre including VAT from September 18 to September 25, then 6.1 cents until October 5, after which the “mobile excise” mechanism is meant to recycle extra state revenue back to the pump. Untouched, the government said, diesel would cost €2.416 a litre.
Meloni described the bollo holiday as a structural turn. Money once spent on fuel duty is now taken off a tax paid by people who drive to work and school.
She compared it to an earlier centre-right exemption for first homes. She said: “While others talk about wealth taxes, we are removing a property tax.”
On paper the waiver lasts only from January 1 to December 31, 2027.
Meloni and economy minister Giancarlo Giorgetti say they intend to make it permanent in the next budget. Giorgetti said the measure was born of an emergency but would “inevitably” become structural.
The League wants it extended to more cars and a cut in the surcharge on powerful engines.
Italy’s public debt is forecast to reach 138.2 per cent of GDP this year, the second-highest in the eurozone after Greece.
Left-wing parties treated it as an election giveaway before a general election due in 2027. They said it does not cut the price of petrol and that it raids money belonging to the regions.
The Democratic Party called the gap between Meloni’s “abolition” and a one-year waiver the real story. Andrea Casu said this was not abolition but “an electoral suspension that the government does not have the courage to make structural”.
Eugenio Giani, the centre-left president of Tuscany, said his region would lose about €350 million in revenue and get little more than €100 million back.
Elly Schlein criticised the recipe as the wrong answer to energy costs. On September 17 she wrote to Meloni proposing about €14 billion of EU budget flexibility, worth up to 0.6 per cent of GDP over three years, be put into heat pumps, social housing insulation, industry, public transport and the grid instead of another tax holiday.
The European Commission has attacked a Polish move to lower VAT on motor fuels to protect consumers from surging prices caused by the conflict in the Middle East. https://t.co/2fzmQPUs06
— Brussels Signal (@brusselssignal) March 30, 2026
