Italy Extends Fuel Excise Duty Cut as Energy Prices and Inflation Surge
Government Measures to Address Rising Energy Costs and Inflation
Extension of Fuel Excise Duty Cut
ROME, April 30 (Reuters) - Italy will extend beyond May 1 a cut in excise duties on fuels to help families and firms cope with rising energy costs, Economy Minister Giancarlo Giorgetti said on Thursday, as consumer prices surged by almost 3% year-on-year in April.
The cabinet will meet to extend the cut "this afternoon," Giorgetti told reporters in parliament.
Previous Spending on Excise Duty Cuts
Italy has already spent around 700 million euros ($818.58 million) to cut excise duties on petrol and diesel for just over 40 days until May 1.
Impact on Diesel and Petrol
Prime Minister Giorgia Meloni said this week the new cut under discussion would likely have a greater impact on diesel than on petrol.
Inflation and Energy Prices
Recent Inflation Data
Meanwhile, Italian EU-harmonised consumer prices (HICP) rose by 1.7% in April from March, with the annual inflation rate jumping to 2.9% from 1.6%, preliminary data showed on Thursday.
Drivers of Inflation
The acceleration in inflation was driven by the energy sector amid turmoil in the Middle East.
Italy's Position within the European Union
Calls for Greater Budget Flexibility
Giorgetti reiterated Italy's calls for the European Union to grant greater budget flexibility for energy-related spending.
"It is very difficult to defend (an EU) clause that provides for budget leeway for defence and rules out aid measures to respond to the energy crisis," he said.
Requests to the European Commission
Italy wants the European Commission to allow member states to soften energy costs by using budget leeway which is explicitly envisaged for defence and security spending.
($1 = 0.8551 euros)
(Reporting by Giuseppe Fonte, editing by Gavin Jones)
