People who dream about spending more time in Southern Italy, enjoying its delicious cuisine and sunny climate, may get a new tax-friendly opportunity. The Italian government has proposed a 10-year tax break for Italian and foreign retirees who move to live in the southern regions of the country, namely, Sicily, Calabria, and Sardinia.
The new policy entitled Zes-Aas (“special economic zone-high social acceptance”), aims to repopulate the southern Italian regions and reinvigorate their economies by luring the émigrés that moved to the northern parts of the country for work and attracting more foreign residents.
At present, the regions of Sicily, Calabria, and Sardinia suffer from a significant decline in their population, high unemployment rates, and a “brain drain”. The incentive is proposed by the right party The League, which comprises half of the new Italian coalition in power.
The program is designed in a way that people (Italians and foreigners) who have reached the retirement age will be exempted from paying any taxes in Italy for a decade, if they spend at least six months per year in their home in Italy. In the future, the program may expand and target young people as well.
The government estimates that an average couple residing in Southern Italy could spend EUR 20.000-25.000 per year, thus boosting the local economy. It is also calculated that, within four years, the program will likely attract about 600.000 new tax residents to the three regions, thus increasing Italian GDP with 1% and adding EUR 17-18 billion to the Italian economy. Similar schemes have already been successfully implemented in Portugal, Canary Islands, Romania, and Cyprus, as the Italian news portal La Voce Cosentina reports.
The municipalities that would like to take part in the scheme need to meet certain pre-conditions, such as to prove that; (i) their population declined with at least 20% in the last 10 years, (ii) their healthcare systems adhere to high standards, and (iii) they have efficient waste collection procedures in place.
An important benefit for people considering moving to Southern Italy is also that the real estate prices in the region are very low. There are hundreds of properties to renovate in Sicily, Tuscany, and Sardinia, sold for a nominal value of 1 euro.
Alberto Brambilla, economic adviser to Matteo Salvini, the interior minister and head of The League, claims that “there are lots of southerners living in places like Milan, Turin and Genoa. They go back to their villages of origin only during the summer. Why not encourage them to make it a permanent move?” Mr. Brambilla also stresses that the incentive will be attractive to foreigners as well: “We think it could appeal to foreigners – Italy is a beautiful country”.
Ask Us Anything
If you want a legal creative sharp tax advice, if you have a remark, an idea… if you want to check a loophole, or you want a second opinion, a company… a bank account or you just want to chat…