Austria Cuts Electricity Tax: National Council Approves New Relief Measures

In a decisive move to combat the rising cost of living and stimulate industrial competitiveness, the Austrian National Council has officially approved a reduction in the national electricity tax during a high-profile special session.

The measure, passed with a broad majority, is a cornerstone of the government’s updated economic strategy for 2025 and 2026. This tax cut is designed to provide immediate financial relief to both private households and energy-intensive businesses across the federal territory.

Direct Impact on Austrian Households

The reduction targets the “Elektrizitätsabgabe” (Electricity Tax), which has historically been a significant component of the total energy price paid by consumers. For the average Austrian household, this policy change is expected to result in savings of dozens of euros annually, offsetting the inflationary pressures seen in other utility sectors.

Government officials emphasized that the move is not just about short-term relief, but about ensuring that electricity remains an affordable energy source as the country continues its transition toward green energy and electric mobility.

Boosting Economic Competitiveness

For the Austrian business sector, the tax reduction is a welcome development. Trade associations have long argued that high non-wage labor costs and energy taxes have placed local manufacturers at a disadvantage compared to international competitors.

“This decision by the National Council provides the necessary breathing room for our industries,” stated a spokesperson for the Ministry of Economic Affairs. “By lowering the tax burden on electricity, we are securing jobs and incentivizing companies to remain in Austria.”

Part of a Larger Fiscal Package

The electricity tax cut does not stand alone. It is part of a broader “relief architecture” discussed during the special session, which also includes:

• Overtime Bonus Adjustments: An increase in the tax-free allowance for overtime bonuses to €170 by 2026.
• Digitalization Savings: A plan to reduce federal administrative costs by 6% by 2029 to fund these fiscal maneuvers.

What Happens Next?

The implementation of the reduced rate is expected to reflect on consumer billing cycles starting in the first quarter of 2026. Energy providers are required to pass these tax savings directly to the end-user.

Critics of the measure have raised concerns regarding the long-term impact on the federal budget; however, supporters argue that the resulting economic growth and increased purchasing power will ultimately lead to higher VAT revenues, balancing the fiscal scales.

For more information on how this affects your specific energy provider, citizens are encouraged to visit the official Austrian Government Portal or contact the E-Control regulatory authority.