Italy to scrap annual car tax for 14.5m vehicles in 2027

Italy will abolish the annual vehicle ownership tax for 14.5 million cars and motorcycles starting in 2027, the government announced on Wednesday. The exemption applies to motorcycles and cars with a maximum power of 80 kilowatts, covering over 70% of small and medium vehicles.

Prime Minister Giorgia Meloni called the levy one of the most hated taxes by Italians and framed the move as part of the centre-right's tax-cutting strategy. Economy Minister Giancarlo Giorgetti said the measure is initially temporary but the government intends to make it permanent in next year's budget.

“Today, the government eliminates one of the ugliest taxes for Italians.”

The scheme allows one vehicle per citizen and is estimated to cost the state €2.36 billion. Italy's public debt is projected to reach nearly 139% of GDP in 2026, surpassing Greece as the highest in the euro zone.

Critics argue the one-year scope makes it an electoral stunt ahead of the 2027 general election. Opposition figures labelled it a misleading operation, while the government compared it to the 2008 abolition of the primary residence property tax.