Italian government proposes controversial eco-tax on polluting cars

Under a new amendment to next year's proposed budget, anyone purchasing a new car in Italy between 2019 and 2021 can benefit from incentives of up to €6,000 if they choose a model that emits 90 grams of carbon dioxide or less per kilometre.

Meanwhile drivers who purchase more polluting cars, defined as those that produce 110 grams or more of CO2 per kilometre, will face a new tax starting at €150 and rising to €3,000 for the worst offenders.

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Minister of Labour and Economic Development Luigi Di Maio, whose Five Star Movement (M5S) submitted the amendment, called it "a bonus-malus on cars that will allow people to pay less tax... based on their car's emissions".

"Electric cars will cost less and we will finally be able to get them into the market, where until now they've had a paltry share," he said.

But Italy's car industry said that the measure would benefit only a small percentage of buyers and penalize most others. 

According to Anfia, the Italian Association of the Automotive Industry, drivers buying a Fiat Panda 1.2, one of the most popular Italian-made models and among the least polluting non-hybrids, would find themselves out an extra €400 to €1,000. 

"The benefits will only apply to people buying expensive electric cars," the association said.

Fiat Pandas outside the company's southern Italian plant. Photo: Andrea Baldo/AFP

Unions warned that the measures could have serious consequences for those employed in Italy's auto industry, with metalworkers' union UILM talking about "tens of thousands of jobs" at risk.

The proposal also drew criticism from Interior Minister Matteo Salvini, who heads the M5S's coalition partner, the League.

"I'm absolutely opposed to any new tax measures on goods that are already hyper-taxed," he declared on Thursday. "If there's a bonus for people who want to switch, great, but I don't think anyone who drives a Euro III diesel does it for the fun of having an old car – clearly they don't have the money to buy a new one."

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The Idea prompted Di Maio to clarify that the eco-tax would only apply to new cars, not to ones already on the roads. The minister also added that the amendment could be "improved" as it worked its way through parliament, saying that he would seek input from the car industry and members of the public.

Italy has repeatedly been reprimanded by the European Union for exceeding the bloc's recommended limits on air pollution. Turin, Milan and Naples are the worst cities in the EU for dangerous particulate pollution, while Italy has the bloc's highest number of premature deaths from nitrogen dioxide fumes spewed out by diesel vehicles, according to the European Environment Agency.

Several cities, especially in the north, have imposed restrictions on driving in certain zones and at certain times in a bid to lower emissions, though Italy has yet to follow other countries' example and phase out of the sale of new diesel vehicles.  

In Rome, however, Five Star mayor Virginia Raggi has pledged to bar all diesel vehicles from the centre of the capital from 2024.

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Photo: Marco Bertorello/AFP