Italy Moves to Raise Its Flat Tax for Wealthy New Residents to 300,000 Euros

Italy is preparing to raise the special flat tax it offers wealthy new residents from 200,000 to 300,000 euros a year. The increase, written into the draft 2026 Budget Law now moving through Parliament, would be the second hike in little more than a year. It lands as Italy emerges as one of the world's top destinations for relocating millionaires, with an estimated 3,600 high-net-worth arrivals projected for 2025.

How the regime works

Introduced in 2017, the regime lets people who have not been Italian tax residents for at least nine of the prior ten years pay a single fixed sum on all foreign-sourced income, rather than facing progressive rates that climb to 43 percent. The benefit runs for up to 15 years. The opening rate started at 100,000 euros, rose to 200,000 in August 2024 through Decree-Law No. 113/2024, and would reach 300,000 under the current proposal. Family members can opt in for an extra annual fee, which the draft would lift from 25,000 to 50,000 euros per person.

What is still unsettled

Key details remain open. The government has not said whether the 300,000 rate would apply only to new entrants or also to people already inside the 200,000 tier. There has also been talk in Parliament of tying the regime to mandatory investment in Italian bonds, startups, or public projects, though no such requirement appears in the current text. Because the Senate can still amend the bill, the final version could look different.

Why Italy is drawing the wealthy

According to the Henley Private Wealth Migration Report 2025, only the United Arab Emirates and the United States are expected to attract more millionaires than Italy this year, with Italy surpassing Switzerland. The appeal blends fiscal certainty with lifestyle, and analysts note that once taxes and housing are added together, Italy can undercut traditional havens despite higher headline rates.

What it means if you have Italian roots

The flat tax is a residency benefit for new movers, not a citizenship route, and it is separate from claiming Italian nationality by descent. But for US applicants weighing a future move to Italy, it is part of the broader picture. None of this is tax or legal advice; consult a qualified professional before relocating. Run the free eligibility check to see your path.