Will there be reduction in fuel excise taxes in Italy
2023.01.12 14:19
Will there be reduction in fuel excise taxes in Italy
By Ray Johnson
Budrigannews.com – According to a statement made on Thursday by Italy’s economy minister, the country may reduce excise duties in an effort to stem rising fuel prices. This is in response to the growing outcry from the general public, which could prove to be the nation’s first major obstacle for nationalist Prime Minister Giorgia Meloni.
In September, Meloni won an overwhelming election, sweeping to power, and poll numbers rose after that.
Economy Minister Giancarlo Giorgetti told parliament that the government would keep an eye on price levels to see if the current trend was caused by “external shocks or speculative behavior.”
The average price of a liter of gasoline was 1.81 euros ($1.96) last week, while the average price of a liter of diesel was 1.86 euros, up from 1.63 euros and 1.68 euros, respectively, two weeks earlier, according to data from the ministry for the environment and energy security.
When the price of gasoline exceeded 2 euros per liter in the first half of 2022, the government canceled a cut in excise duties that had been proposed by Meloni’s predecessor Mario Draghi.
But Giorgetti told lawmakers that the government could cut excise taxes again “in relation to any verified increase in fuel prices.”
The previous day, Meloni offered an argument in favor of the decision not to extend the price rebate on fuel prices, stating that doing so would have cost 10 billion euros and implying that the available resources would be used instead to fund more specific programs for the poor.
Excise taxes and VAT sales tax account for more than half of the price of gasoline and diesel in Italy.
Over 21 billion euros have been allocated in this year’s Italian budget to help businesses and households pay their gas and electricity bills, primarily through subsidies for low-income families and businesses that use a lot of energy.
According to Giorgetti, Rome was looking into additional relief measures, such as a temporary price cap under the European Commission’s so-called “two-tier approach.”
Giorgetti stated, “This cap has the advantage of reducing overall consumption by providing for a capped price below a certain percentage of consumption and leaving the price of the remainder to the market.”
The opposition 5-Star Movement’s leader, former Prime Minister Giuseppe Conte, stated that he anticipated a popular uprising similar to the 2018 “yellow vest” movement in France against rising fuel prices.
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