Specialist tax advisory Taxing.it confirmed that Article 26 of Law 34/2026—published in the Official Gazette on 11 March and effective retroactively from 7 April—raises the population ceiling for municipalities eligible under Italy’s 7 % substitute-tax regime for foreign-source pensions from 20,000 to 30,000 inhabitants. The blog post, updated on 29 April, explains that medium-sized coastal centres such as Termoli (Molise) and Ragusa (Sicily) now qualify, giving retirees better healthcare access and transport links than the small villages originally targeted by the 2019 law. Under the regime, foreign pensioners who become Italian tax residents can opt to pay a flat 7 % on all non-Italian income for up to ten years, provided they settle in one of the designated southern or earthquake-affected municipalities. Expanding the threshold captures roughly 140 additional towns and could, according to Svimez, attract an extra 4,000 pensioner households per year, injecting €180 million into local economies through real-estate purchases and services consumption. Immigration lawyers report a surge in enquiries from UK, US and Canadian retirees looking for more urbanised settings with rail connections and bilingual medical facilities. Applicants must still obtain an elective-residence visa (if non-EU) and register with the local health-authority within eight days of arrival.
![Italy widens 7 % ‘pensioner flat-tax’ to towns of 30,000 residents, boosting relocation options]()
For retirees who need assistance with that elective-residence visa, VisaHQ offers a streamlined online application service: its Italy portal (https://www.visahq.com/italy/) provides step-by-step checklists, document reviews and appointment scheduling, along with multilingual support that can make gathering bank statements, medical-insurance certificates and other paperwork far less daunting.
The tax agency (Agenzia delle Entrate) is expected to publish clarifying guidance on transition rules, particularly whether taxpayers who moved to 25,000-inhabitant towns earlier in 2026 can elect the regime for the current fiscal year. For corporate mobility programmes the change is relevant to early-retirement packages for internationally-mobile executives: relocating to a qualifying town enables significant tax savings on company pensions and investment income. Employers should update exit-planning checklists and consider covering initial legal fees—typically €3,000–€5,000—to facilitate smooth transitions. Local mayors have welcomed the amendment but emphasise the need for accompanying policies on healthcare staffing and digital infrastructure to ensure the influx benefits host communities sustainably.
For retirees who need assistance with that elective-residence visa, VisaHQ offers a streamlined online application service: its Italy portal (https://www.visahq.com/italy/) provides step-by-step checklists, document reviews and appointment scheduling, along with multilingual support that can make gathering bank statements, medical-insurance certificates and other paperwork far less daunting.
The tax agency (Agenzia delle Entrate) is expected to publish clarifying guidance on transition rules, particularly whether taxpayers who moved to 25,000-inhabitant towns earlier in 2026 can elect the regime for the current fiscal year. For corporate mobility programmes the change is relevant to early-retirement packages for internationally-mobile executives: relocating to a qualifying town enables significant tax savings on company pensions and investment income. Employers should update exit-planning checklists and consider covering initial legal fees—typically €3,000–€5,000—to facilitate smooth transitions. Local mayors have welcomed the amendment but emphasise the need for accompanying policies on healthcare staffing and digital infrastructure to ensure the influx benefits host communities sustainably.
