Italy Raises Flat Tax Rate for Wealthy Individuals Starting 2026

The Italian government announced plans to raise the flat tax for high‑net‑worth individuals (HNWI) from €200,000 to €300,000 per year and to increase the additional rate for qualified family members from €25,000 to €50,000. The new rates will take effect in the 2026 tax year and apply only to taxpayers who are Italian tax subjects when the increase becomes operative.

The flat‑tax regime applies solely to foreign‑source income of HNWI who have not been Italian tax residents for at least nine of the previous ten years, while domestic income remains subject to the regular progressive rates. HNWI who were already Italian tax residents before 2026 will continue to pay the old rates of €200,000 plus €25,000. As of 2025, 1,070 HNWI and 425 family members have used the scheme, generating €315 million in tax revenue from 2020 to 2023.

The rate increase aims to recalibrate fiscal incentives and boost state revenue. Affected individuals must reassess the timing of any relocation to Italy for tax purposes. The scheme continues to serve as a key tool for attracting foreign wealth to the country.