Germany's Chancellor Friedrich Merz's coalition government has approved a significant €1.6 billion ($1.9 billion) package aimed at alleviating the impact of surging fuel prices on German consumers. This initiative is part of a broader effort to stabilize Europe's largest economy. The core of this relief plan involves reducing the gasoline tax by 17 cents per liter, a measure that will be in effect for a two-month period.
This decision, finalized on April 12, followed earlier negotiations within the coalition, which had been deadlocked over a larger relief package potentially reaching €5 billion ($5.9 billion). The government also introduced measures to increase transparency and tighten competition law in the fuel sector. Effective April 1, new regulations permit petrol stations to increase prices only once daily at 12 noon, while price reductions are allowed at any time. Violations of this rule can lead to fines of up to €100,000 ($115,400).
Additionally, the Federal Cartel Office has been empowered with stronger tools to combat abusive pricing practices by companies with market dominance in the fuel sector. This includes the ability to demand justification for price increases and identify structural distortions of competition more easily. The coalition further agreed to tighten competition law to ensure that falling commodity prices are quickly passed on to consumers. These measures aim to prevent excessive prices, especially compared to independent petrol stations.
