Italy extends diesel excise tax cut to 5 September with 130 million euro package

Extension details and financing structure

The Italian government approved an urgent decree-law on 26 August 2026 extending the 17-euro-cent per liter excise duty reduction on diesel fuel until 5 September 2026. The 10-minute cabinet meeting led by Prime Minister Giorgia Meloni allocated approximately 130 million euros to cover the 10-day period of heavy summer return traffic. President Sergio Mattarella signed the decree, which entered into force at midnight as the previous discount expired. Total spending on fuel excise discounts between July and August reached 500 million euros, bringing cumulative state expenditure on fuel relief since mid-March to roughly 2.6 billion euros at a rate of 13 million euros per day. To fund the latest extension without imposing windfall taxes, the government introduced a mechanism requiring large energy corporations with 2025 revenues exceeding 20 billion euros, notably Eni, to advance 39% of their dividend taxes. This advance grants the companies an equivalent tax credit in return while extending separate tax credits for commercial road hauliers.

Pump prices and household holiday burdens

The extension takes effect as retail fuel costs continue an upward trajectory across Italian transit corridors. According to data from the Ministry of Enterprises and Made in Italy price observatory, national average self-service prices reached 2.017 euros per liter for petrol and 2.137 euros per liter for diesel on 26 August. Along motorway networks, self-service prices climbed higher, averaging 2.092 euros per liter for petrol and 2.208 euros per liter for diesel. Without the 17-cent reduction, diesel pump prices on standard roads would have exceeded 2.307 euros per liter. Business association Confesercenti reported that Italian motorists spent an additional 1.8 billion euros on fuel across July and August compared to the same months in 2025, representing a 21% surge. In the summer of 2025, petrol averaged 1.70 euros per liter and diesel 1.63 euros per liter, meaning filling a 50-liter tank currently costs roughly 16 euros more for petrol vehicles and more than 25 euros more for diesel vehicles.

Coalition debates and income-tested support

Economy Minister Giancarlo Giorgetti, Undersecretary Alfredo Mantovano, and ministry technicians weighed options to end the subsidy on 4 September, 5 September, or 7 September before settling on the 5 September date. Deputy Prime Minister Antonio Tajani opposed calls for mandatory windfall levies on energy firms, drawing a distinction between negotiated corporate contributions and statutory profit taxes.

I am completely opposed to any hypothesis of windfall profits, of taxes. When I hear the word taxes, I get hives. A dialogue, a contribution is right to be given, as we did with banks, with insurance companies. There must be an agreed dialogue in a difficult moment also on the part of companies in the sector. But I do not want to hear the word windfall profit, which smacks very much of the Soviet Union to me.

Deputy Prime Minister Matteo Salvini indicated that the administration seeks a more continuous and substantial framework once the temporary diesel cut concludes. Following the 5 September expiration, the cabinet plans to transition from general price reductions to targeted, income-selective relief packages designed to assist lower- and middle-income families as well as businesses. Five Star Movement leader Giuseppe Conte criticized the temporary cut as an imperceptible discount already overtaken by pump inflation.