Car tax 2027: the State scraps it for one year and reimburses the Regions. From 2028 the money is not there
28 October 2026, 16:00
On 27 October the Parliamentary Budget Office, the independent body that examines the public accounts for Parliament, published its analysis of the car tax exemption. The government decided it with Decree-Law 162 of 17 September: for the whole of 2027, no car tax is due from anyone who owns a petrol, diesel or hybrid car of up to 80 kW, one per registered owner, or, if they own no car meeting these requirements, a motorcycle. It costs about €2.36 billion, and almost all of it is paid by the State to the Regions, which collect the car tax, to make up for the lost revenue.
The Office acknowledges its merit: the benefit is worth 0.9% of the annual spending of the least well-off families and 0.1% of that of the most affluent. Since 1983, in fact, car tax has been due simply for owning the car, even if it sits unused in the garage, and it weighs up to six times more on the budgets of families with less means than on those of well-off families.
The accounts, however, hold for one year only. The exemption is funded for 2027, the Office writes, "largely with one-off PNRR savings", that is, with savings, which will not recur, on the funds of the European recovery plan. A sum that comes along once pays for a tax that comes back every year. To make it permanent, as the government says it wants, permanent resources would be needed, and so far nobody has identified any.
That leaves the question of who pays in place of those exempted. Car tax is a regional tax, and each Region can raise the rate for its own motorists. With the exemption, the Office notes, the increase that some Regions chose to ask of their residents moves onto the State budget, that is, onto all Italian taxpayers. The Regions that raised the rate thus get the increase reimbursed as well, and the residents of the Regions that kept it low help to pay for it too.
Finally, the families who get nothing from the exemption lose out too. According to the Office's estimates, almost two Italian families in three benefit: the others, including those who own neither a car nor a motorcycle and those who only own more powerful cars, get no discount at all, and yet the €2.36 billion comes out of the State budget, which is theirs too. If the exemption became permanent, the Office adds, the differences between regional rates would be frozen at the State's expense, and the link between the taxes a Region decides and its accountability to those who pay them would weaken.
Two questions therefore remain for the Ministry of Economy and Finance, which is responsible for the allocation and the funding: in dividing the reimbursement among the Regions, due by 31 March, will those who raised car tax the most receive the most? And with what money will the exemption be paid for in 2028?
Car tax is paid even when the car is not moving. The discount is funded even by those who do not own a vehicle.
This article was prompted by a news item published in Il Fatto Quotidiano on 27 October 2026.