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COST OF LIVING

Fuel tax cut and help with energy bills: Italy approves inflation aid package

Italy on Thursday night approved new measures worth around 17 billion euros ($17.4 billion) to help families and businesses manage the surging cost of fuel and essentials.

Fuel tax cut and help with energy bills: Italy approves inflation aid package
New aid measures announced on Thursday are hoped to boost Italy's consumer spending power as the cost of everyday goods rises. Photo by Vincenzo PINTO / AFP)

As expected, the final version of the ‘aiuti-bis‘ decree provides another extension to the existing 30-cents-per-litre cut to fuel duty, more help with energy bills, and a tax cut for workers earning under 35,000 euros a year.

The package also includes further funding for mental health treatment: there’s another 15 million euros for the recently-introduced ‘psychologist bonus’ on top of the 10 million previously allocated.

READ ALSO: What is Italy doing to cut the rising cost of living?

There are also measures to help agricultural firms deal with this year’s severe drought.

Italian Prime Minister Mario Draghi described the new package as an intervention “of incredible proportions”, which corresponds to “a little over 2 points of national GDP”.

However, he said, no changes were made to the national budget to pave the way for the new measures.

The measures will be funded with 14.3 billion euros in higher-than-expected tax revenues this year, and the deployment of funds that have not yet been spent, Economy and Finance Minister Daniele Franco said.

Italy has already budgeted some 35 billion euros since January to soften the impact of rising fuel costs.

The decree is one of the last major acts by outgoing Prime Minister Mario Draghi before an early general election next month.

Elections are set for September 25th but the former European Central Bank chief is staying on in a caretaker role until a new government is formed.

Draghi said the Italian economy was performing better than expected, citing the International Monetary Fund’s estimate of three percent for 2022.

“They say that in 2022, we will grow more than Germany, than France, than the average of the eurozone, more than the United States,” he told a press conference.

But he noted the many problems facing Italy, “from the high cost of living, to inflation, the rise in energy prices and other materials, to supply difficulties, widespread insecurity and, of course political insecurity”.

Inflation hit 8 percent in Italy in June – the most severe spike the country has experienced since 1986.

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COVID-19 RULES

Italy eases Covid measures ahead of new government

Italy's outgoing government is easing measures against coronavirus from Saturday despite an increase in cases, weeks before handing over to a far-right administration that has criticised the tough restrictions.

Italy eases Covid measures ahead of new government

Prime Minister Mario Draghi’s government said it would not renew regulations requiring FFP2 face masks to be worn on public transport – these expired on Friday.

However, it has extended for another month the requirement to wear face masks in hospitals and other healthcare settings, as well as residential facilities for the elderly.

READ ALSO:  Why are so many Italians still wearing face masks in shops?

By the time that rule expires on October 31, a new government led by far-right leader Giorgia Meloni is expected to be in place — with a very different attitude to Covid-19 restrictions than Draghi’s.

Italy was the first European country to face the full force of the coronavirus pandemic in early 2020, and has had some of the toughest restrictions.

Last winter, it required certain categories of workers to be vaccinated and demanded proof of a negative test, recent recovery from the virus or vaccination — the so-called Green pass — to enter public places.

READ ALSO: What is Italy’s Covid vaccination plan this autumn?

The pass was strongly criticised by Meloni’s Brothers of Italy party, which swept to a historic victory in elections on Sunday.

“We are against this certificate, full stop,” the party’s head of health policy, Marcello Gemmato, La Repubblica newspaper on Friday.

He said it gave “false security” because even after vaccination, people could get and spread coronavirus.

Gemmato said vaccines should be targeted at older people and those with health problems, but not be obligatory, adding that the requirement for healthcare workers to be vaccinated would not be renewed when it expires at
the end of the year.

READ ALSO: Italy gives green light to new dual-strain Covid vaccines

Cases of coronavirus are rising slightly again in Italy, likely due to the return of schools and universities.

More than 177,000 people with coronavirus have died in Italy since the start of the pandemic.

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