Italy to abolish road tax from 2027: what we know

Italy is abolishing road tax for millions of cars and motorcycles from 2027. Find out who will be eligible for the exemption and what conditions will apply

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Italy is scrapping the road tax for millions of cars, according to the Reuters news agency. The Italian government has approved the decision, and starting in 2027 it will exempt owners of low- and medium-power cars and motorcycles from the annual vehicle ownership tax. This is one of the most anticipated moves in vehicle taxation in recent years, and it will affect millions of drivers across the country.

Read also, Greece to raise the property tax on foreign owners fivefold.

When planning a road trip across Europe, it's important to take care not only of your vehicle's technical condition but also of the full set of mandatory documents. One document that's increasingly required is the electronic road vignette – a digital confirmation of payment for using toll motorways. Get your e-vignette online before your trip to save time at the border.

Who will be affected by the 2027 car tax exemption in Italy?

The exemption covers petrol, diesel and hybrid passenger cars with power up to 80 kW, as well as all motorcycles and mopeds without exception. According to estimates from the relevant ministry, the total number of vehicles covered by the exemption reaches around 14.5 million – more than 70% of cars currently on the road. However, the benefit can only be claimed for one insured vehicle per person: if someone owns several eligible cars, the exemption automatically applies to the least powerful one.

Find out how to start a business in Italy in 2026 in our detailed guide.

Conditions for the car tax exemption in Italy

- The exemption applies only to private individuals, not to vehicles registered for commercial use;

- The vehicle must be properly insured;

- No application is required – the exemption is granted automatically when the tax payment falls due in 2027.

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How much will Italy's state budget lose from scrapping the car tax?

Scrapping the tax is not a cheap decision for the state treasury. According to preliminary estimates, it will cost more than €2.3 billion, funds that previously went to regional budgets, since this tax has traditionally been directed there. The government has promised to compensate regions for the lost revenue, though the specific compensation mechanism has not yet been finalized.

Traffic rules, fines, toll roads and ZTLs: everything you need to know if you're planning a road trip to Italy is in this guide.

A temporary measure or a long-term reform?

For now, the tax exemption is officially set to apply only during 2027 – that's the timeframe laid out in the decree already published. Government officials have stated their intention to make the benefit permanent, but a final decision on that is expected when next year's budget is approved, likely in autumn. In other words, drivers should keep an eye on further updates: what currently looks like a one-off move ahead of the election could theoretically turn into a structural change to the tax system – or remain a one-time measure.

The political context behind Italy's car tax decision

The decision was made amid preparations for national elections in Italy, and critics reasonably link it to the government's push to boost voter support ahead of the vote. In parallel, the government extended a temporary cut to the fuel excise duty – another step aimed at easing the financial burden on drivers amid high fuel prices. Opponents describe both decisions as targeted political gestures rather than a systemic tax reform.

Changes to car taxation are just one of several costs worth factoring in. If your route runs through toll motorways in other European countries, you'll need another mandatory document – the electronic road vignette. It confirms that the driver has legally paid the road usage fee, and without it, driving on toll roads is considered a violation that can result in an on-the-spot fine.

The e-vignette can be purchased online in just a few minutes, with no queues or paperwork, and the details are instantly added to the official database for automatic number-plate verification. This is especially convenient for anyone planning a longer trip through several countries who wants to avoid unnecessary stops and fines.

Get your e-vignette in advance on the Visit World portal and travel without the hassle.

A reminder: the cost of living in Italy varies significantly depending on the city, rental prices and personal habits. Housing usually takes up the biggest share of the budget, but you should also factor in food, utilities, transport and everyday purchases. We've already covered current living costs and the amount one person needs for a comfortable life in Italy.

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Products from Visit World for a comfortable trip:

Checklist for obtaining a visa and necessary documents in Italy;

Legal advice on immigration to Italy;

Travel insurance for foreigners in Italy;

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