Wealthy residents who leave Italy from 2027 could face a 26% tax on gains they have not yet cashed in, under a provision included in the country's draft budget sent to the Chamber of Deputies on October 30. The levy would apply to unsold gains of residents who move abroad with at least €800,000 in financial assets, and would cover moves that take effect from January 1, 2027.

Set out in Article 17 of the bill, the measure would apply to people who move their tax residence abroad with assets worth at least €800,000, or about $894,000. It would add Article 307-bis to Italy's income tax law. The tax would only apply to people who were tax residents in Italy for at least six of the ten years before leaving.

Il Fatto Quotidiano listed the exit tax among the budget's previously unannounced measures. The 157-article text appeared two days after the Council of Ministers approved the €26 billion package.

How the Exit Tax Would Work

The tax falls on gains built up before departure. These are calculated as the difference between each asset's market value and its cost for tax purposes. It targets shares, equity stakes, securities, and other financial instruments, but not bank deposits. Simple partnerships and non-commercial entities are also covered. Because it is assessed on gains that have not been realized through a sale, the levy would reach paper wealth at departure rather than waiting for assets to be sold.

Government bonds receive a reduced taxable base of 48.08%. This brings the effective rate on them to 12.5%, the same rate Italy already applies to income from its public debt.

Italy already taxes companies and entrepreneurs who move abroad. The new rule would extend that treatment to private investors.

Payment and Deferral Rules

Departing taxpayers would have to pay within 180 days of the move. People moving to another EU country, or to a country with tax cooperation agreements with Italy, could delay payment until they sell. To defer, they would have to pay 50% of the tax up front and provide a suitable guarantee.

As an illustration, a long-term resident moving to Spain with a €2 million portfolio bought for €1.2 million would owe €208,000 and would need to pay €104,000 at once.

Deferral would last up to five years after a move within the EU and up to ten years for other qualifying countries. The tax is cancelled on any asset left unsold when the period ends, and advance payments are refunded. Unsold assets are also exempt if they pass to heirs or if the taxpayer moves back to Italy. Reports do not name which non-EU countries qualify.

The Italian rules closely follow France's exit tax, which uses the same six-of-ten-year residence test and €800,000 threshold. France grants deferral within the EU without requiring a guarantee.

Revenue Estimates and Criticism

The government's technical report expects revenue of €3.37 million in 2027 and €6.74 million a year from 2028 through 2031 once the scheme is fully running. It puts net revenue at €3.37 million a year from 2032 once refunds are counted.

Federico Salmoiraghi of OFF Italy Consulting said the measure “appears poorly defined, leaving considerable room for doubt and interpretation.” He called on the government to “substantially revise the proposal or withdraw it altogether.”

Reports do not say whether the tax would reach residents under Italy's flat-tax regime, which charges newcomers €300,000 a year on foreign income. The answer would matter for wealthy newcomers who arrived under that regime, since it would determine whether they too face the levy if they later move their residence out of Italy.

The bill is the last budget of Prime Minister Giorgia Meloni's government before the 2027 general election. Parliament normally approves the budget by the end of December, and lawmakers can still amend Article 17 before the final vote. That timeline leaves the coming weeks of parliamentary debate as the window in which the levy's final scope will be settled.