Meloni Scraps Road Tax for Millions Ahead of Italian Election

Italian Prime Minister Giorgia Meloni's government is set to eliminate road tax for millions of drivers, a decision announced as the conservative coalition seeks to bolster support ahead of a general election that must be called by autumn of next year. The move, affecting 14.5 million cars and motorcycles starting next year, is anticipated to cost the state more than €2.3 billion.

Meloni stated that the government is removing "one of the taxes Italians dislike most" and continuing its agenda of reducing the tax burden. She emphasized that the measure will assist Italian families who rely on vehicles daily for work, school runs, and general transportation. The exemption will apply to all motorcycles and over 70% of small- and medium-sized cars, though each citizen will be eligible for the benefit on only one insured vehicle.

Under a draft decree, the tax exemption is planned for 2027 for vehicles with a maximum power output of 80 kilowatts (kW). Economy Minister Giancarlo Giorgetti indicated that the government aims to make the measure permanent, with the possibility of integrating it into the budget to be unveiled in October. However, the exact funding sources for the initiative remain unclear. Italy's public debt is projected to peak at nearly 139% of its gross domestic product (GDP) this year, making it the most indebted country in the Eurozone.

Opposition parties have accused Meloni of engaging in electioneering with the announcement. Eugenio Giani, governor of Tuscany and a member of the center-left Democratic Party, criticized the move as "reckless demagoguery" and warned of significant revenue shortfalls for Italy's 20 regions, estimating Tuscany alone would lose €350 million.

Others dismissed the policy as a distraction from rising energy and fuel costs. Rossano Sasso, a senior aide to hard-right party leader Roberto Vannacci, likened the measure to "treating pneumonia with a throat lozenge."

Meloni has denied that the policy is an attempt to gain votes and has also rejected speculation about an early election, affirming her intention to serve the full five-year term, which concludes next September. She recently became Italy's longest-serving prime minister since World War II. Despite its growing popularity, Meloni has ruled out an alliance with Vannacci's National Future party.

The center-left alliance faces its own internal divisions, particularly concerning the war in Ukraine, with some leaders expressing concerns about Western involvement escalating into a wider conflict. The alliance has also yet to select a leader for the upcoming election.