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Italy rejigs measures to stimulate sales of green cars

MILAN (Reuters) – Italy will offer subsidies of up to 6,000 euros ($6,820) to buyers of new low emission vehicles to save the tax on the purchase of larger gasoline and diesel cars, according to the measures that were approved in the parliament.

FILE PHOTO: A woman drives a Renault Twizy two-seat electric car in Rome, Italy, 5 March 2018. REUTERS/Max Rossi/Photo File

The measures, which in Italy 2019 budget passed by the upper house on Sunday, changes to rules proposed by Rome, earlier this month, which drew criticism from the car industry.

Unions and car industry associations have warned about the proposed new tax, which says that it may harm not only manufacturers but also the entire supply chain and could cost jobs.

Italy, the ruling parties – the anti-establishment 5-Star Movement and the right-wing League are at odds over the issue, with the latter opposing any new taxes on cars, while the pro-environment 5-Star hotel has encouraged the new rules.

In their new form, the proposed tax for cars running on traditional fuels do not apply to small family cars, but only the larger high-powered vehicles, including Suvs.

A tax of 1.100 euros will be slapped on the new petrol and diesel cars to generate 161-175 grams of CO2 emissions per kilometre. That will increase to 1,600 euros for the emissions of 176-200 and 2,000 euro for the emission of 201-250.

Incentives for electric and hybrid vehicles, meanwhile, will vary depending on the emissions and do not apply to models that cost more than 50,000 euro 57,000).

The new measures still have to be approved in the second room, goes in on 1 March and the last at the end of 2021.

Electric, hybrid and methane gas-powered cars at this time only about 7% of Italy is the sale of cars.

Italy’s Fiat Chrysler, which currently sells no electric or hybrid cars in Europe, said in November it was planning to spend more than 5 billion euros in new models and engines in Italy between 2019-2021.

In December, in response to the original measures, Fiat said that it could be her Italian investment plan as Rome increased taxes on petrol and diesel cars. Fiat has not responded since changes in the original proposals were made.

Italy 2019 budget expected to be approved by the second chamber of parliament this week.

($1 = 0.8797 euros)

Reporting by Stephen Jewkes; Editing by Alison Williams

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