Germany's fuel tax rebate ends, drivers urged to fill up in June

Germany's fuel tax rebate, a measure implemented to ease the burden on drivers, concludes at the end of June. Starting July 1, fuel will revert to higher tax rates, a change expected to increase prices by approximately 16.7 cents per liter, including value-added tax. Christian Laberer, a fuel market expert at ADAC, anticipates this price jump, noting that the "fuel discount" has been in effect for two months.

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It is to be feared that prices will rise by about this amount.

The timing of the price increase presents a unique situation. According to the established "12 o'clock rule," fuel prices can only be adjusted at midday, not at midnight when the tax relief officially ends. The German Ministry for Economic Affairs has indicated no special exceptions will be made for this transition. Consequently, some gas stations might raise prices significantly on the afternoon of June 30 or delay price reductions. However, Laberer suggests the major price hike will likely occur around noon on July 1, as most stations will still have fuel taxed at the lower rate in the morning.

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The tax euro can only be spent once.

While the tax is based on delivery, not sale, Laberer believes a gradual increase in the first few days of July, as theoretically possible, is unlikely based on experiences with a similar rebate in 2022. He added that if oil prices continue to stabilize, fuel prices should ideally remain below 2 euros per liter even without the discount, a trend already visible with diesel but becoming tight for gasoline.

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We prefer to invest it in an income tax reform that provides lasting relief.

ADAC advises motorists to fill up their tanks before the end of June, ideally on the late morning of June 29. Laberer recommends planning ahead, as "there could be queues at gas stations" shortly before the daily 12 p.m. price adjustment, when gasoline is typically cheapest. The government's decision to end the rebate, which cost the federal budget an estimated 1.6 billion euros, was partly due to its expense. A task force leader, CDU politician Sepp Müller, stated that "tax revenue can only be spent once," and suggested prioritizing a permanent income tax reform, planned for January 2027, over the temporary fuel discount.

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On June 29, you are probably on the safe side.