Germany’s lower house of parliament has approved a temporary reduction in fuel taxes aimed at easing pressure on motorists and businesses facing sharply higher petrol and diesel prices.
The measure, passed on Friday, September 25, will cut taxes on gasoline and diesel by about €0.17 per litre from October through December. The relief is expected to cost the federal and state governments around €2.5 billion.
The upper house, which represents Germany’s states, was expected to vote on the measure later on Friday. If approved, the tax reduction will take effect from October 1.
The government introduced the measure as energy and transport costs remain elevated amid the continuing Iran war, which has pushed global oil prices higher. Germany had already implemented a temporary fuel tax reduction in May and June, costing about €1.6 billion.
The latest intervention comes as higher energy costs weigh on household purchasing power and business operating expenses. German consumer sentiment weakened sharply heading into October, with households increasingly concerned about the impact of energy prices on their incomes.
The fuel relief therefore represents another government effort to cushion consumers and businesses from the wider economic impact of elevated energy costs.
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