The introduction of contested taxes on plastic and sugary drinks has been postponed for a fifth time in Italy and will not now come into force until 2023, the government said in a statement.
The twin levies were due to be applied at the start of 2020, and were originally designed to raise more than €1 billion annually.
However, a backlash from producers persuaded the then government to trim the proposed duty on plastics and push back the introduction date. The dates were further delayed because of the COVID-19 crisis, which savaged the economy.
Growth is now picking up again, but prime minister Mario Draghi has said he does not want to increase taxes that might jeopardise the recovery.
Single-Use Plastic Production
The tax on single-use plastic production rode on a wave of international action against pollution, while the tax on sugary drinks was intended to address health issues such as obesity, diabetes and tooth decay.
Environmental groups said they were dismayed by the decision to postpone the plastic levy.
"How is it possible that the government chooses to put the interests of the plastics industry before those of its citizens?" Greenpeace said on Twitter.
Eslewhere, morale amongst Italian businesses and consumers rose to multi-year highs in July as the government continued to steadily ease coronavirus restrictions. The country's manufacturing confidence index increased to 115.7 in July from 114.8 in June, posting its highest level since the current data series was introduced in March 2005.