Germany's fuel tax rebate expires today, prices to rise Wednesday noon as state premiers demand further relief

End of the rebate

Germany's temporary fuel tax rebate, introduced in early May to cushion drivers from soaring oil prices after the Iran war, expires at midnight on 30 June. From 1 July, the old, higher energy tax applies again, adding 16.7 cents per litre including VAT. However, the price increase will not hit pumps immediately. The bft petrol station association expects the rise to become visible only on Wednesday at noon, because the so-called 12-Uhr-Regel prohibits price changes at midnight and large oil companies fear social media backlash if they raise prices earlier.

Political reactions

Mecklenburg-Vorpommern's Minister-President Manuela Schwesig (SPD) urged the federal government to act.

“If the federal government lets the fuel rebate expire, then I expect the Chancellor to talk to the oil companies so that petrol prices do not rise again.”

She also called for a price cap modelled on Luxembourg, where the economy ministry sets maximum prices for petrol, diesel and heating oil, and for a tax reform that relieves low and middle incomes. Saxony-Anhalt's Minister-President Sven Schulze (CDU) defended the rebate's effect.

“Unlike many skeptics predicted in advance, the rebate was almost fully passed on. Commuters, logisticians, tradespeople, farmers and many more urgently needed this rebate, especially in a rural state like Saxony-Anhalt.”

He expressed hope that the Middle East situation would ease and oil prices would fall.

The 12-Uhr-Regel and market impact

Carsten Müller, chairman of the bft, which represents small and medium-sized petrol stations, sharply criticised the 12-Uhr-Regel.

“The 12 o'clock rule has benefited neither consumers nor the medium-sized petrol station sector.”

He said midday business is practically dead, with almost no fuel sold between 12:00 and 14:00, while sales concentrate in the morning. Closing during that window is not an option because consumers expect stations to be open. The bft sees little chance of abolishing the rule but suggests moving the price-change time to the evening.

Cost and effectiveness

The rebate cost the federal government an estimated 1.6 billion euros, according to the Finance Ministry, though the final figure will only be known in several months. While Schulze insisted the relief was almost fully passed on, the Ifo Institute found that the rebate was probably not passed on in full to customers.