The latest extension is expected to cost the government about €130 million ($151 million) in lost tax revenue, Anadolu Agency reported.
Prime Minister Giorgia Meloni’s government has repeatedly extended fuel tax reductions since the outbreak of the US-Iran conflict in February, which contributed to a rise in global crude oil prices.
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The latest measure applies only to diesel, with the excise duty reduced by about 17 euro cents per liter through Sept. 5.
The extension comes as higher fuel prices become an increasingly important concern for Italian consumers and businesses, particularly trucking companies and farmers that depend heavily on diesel.
Rising energy costs are also putting additional pressure on Meloni’s right-wing government as it seeks to protect household purchasing power and sustain economic growth.
The issue could carry significant political consequences ahead of parliamentary elections next year. Opposition parties have accused the government of failing to address the broader cost-of-living squeeze, while business groups have warned that persistently high fuel prices could hurt Italy’s competitiveness.
Meloni’s office said earlier this week that once the current fuel tax reductions expire, the government could shift toward more targeted assistance for lower-income households instead of continuing broad-based tax cuts.
The Italian Confederation of Craft Trades and Small- and Medium-Sized Enterprises (CNA) estimated Monday that the Iran war could cost Italy nearly €12 billion ($13.9 billion).
According to the CNA, the additional cost of fuel, electricity and gas between March 1 and Aug. 31 was expected to reach about €11.6 billion ($13.5 billion) compared with prices before the conflict began on Feb. 28.
More than half of the additional burden was attributed to mobility costs, highlighting the impact of higher fuel prices on households and businesses.
The CNA estimated that gasoline and diesel costs alone would add around €5.8 billion to Italy’s expenses over the six-month period.
With fuel prices remaining a growing concern, the government’s decision to extend the diesel tax cut offers temporary relief while raising questions about how Italy will tackle the longer-term impact of higher energy costs.
