Is It Better to Attract Capital or Only the ‘Pure of Heart’ to Our Country?
On Italian fiscal moralism and the hypocrisy toward those who return or choose to invest in Italy
This is the English version of an original post first published on Esco quando voglio
Disclaimer:
I’m publishing my reply to a post (link here) by Fausto Boni on LinkedIn. The following text is a personal reflection, written in response to the debate sparked by his public comments.
I don’t know Fausto Boni personally and—as his CV shows—he is not the typical Italian who barely holds a passport and comments on the country's tax policies out of envy. Quite the opposite!
That’s exactly why I chose to keep my comment calm and as objective as possible. Unfortunately, not concise.
If I may say so, his post seems like a bitter mix of poor understanding of the current regulations, made worse by a terrible little article in Corriere della Sera (though I’d be surprised if someone of his caliber fell for it), and an indirect, irritated attack on specific cases he clearly has in mind.
Mini bio. I’ve been living abroad for almost 30 years. I’ve invested far too much in startups launched by Italians abroad (sometimes hurting myself in the process), and I work—among other things—on helping foreign investors enter the Italian market, mostly by guiding them toward territorial regeneration projects. Among other initiatives, including in publishing, I run a community (itsjournal.com) of about 35,000 Italians abroad, Italians returning (a book is coming soon featuring around 100 of their stories, selected from over 200 collected), and foreigners moving to Italy—not just HNWIs. In short, I have skin in the game.
I care about this topic out of personal passion, but also as a result of a choice I dare define as ‘political.’ I’m certainly no Scrooge McDuck—maybe more of a Donald Duck—but I speak with data and experience. My opinion may carry less weight than his, but I respectfully disagree with his views across the board.
First of all, the starting point is an article that contains nothing new and ends up being the usual Italian mess, based on long-circulated data from Henley & Partners about global HNWI movements. At this moment, there’s a genuine exodus from London (and not only), mainly due to recent changes affecting non-dom residents (you’ll find various posts in my feed with data from the Financial Times and other credible sources), and Italy appears to be benefiting—thanks to rules passed years ago that were hardly ever promoted diplomatically. Because yes, unlike what Mr. Boni suggests, I believe our economic diplomacy could have done even better in the past.
The Corriere article is poor (and misleading, since the tax breaks for returning professionals and the flat tax for HNWIs are two entirely different laws), and his interpretation only adds to the confusion.
One measure is aimed at attracting a few thousand HNWIs globally. That money would never have arrived otherwise. It won’t save the national budget, but the resulting secondary investments are considerable—and most importantly, it places Italy at the center of a major shift, which accelerated after COVID and particularly after the non-dom regime collapsed in the UK. It’s no coincidence that even in London, some are now questioning whether that regime should’ve been preserved (see the recent FT article). Because between Brexit, COVID, and now the end of the non-dom regime, things are objectively going badly in London.
Totally different is the measure designed to attract returning talent (drastically reduced 18 months ago—and currently under review) following a proposal by MP Centemero. This, too, has triggered envy in many Italians—a people known for their excellence in tax evasion, who nevertheless can’t stand the idea that someone might return after achieving a degree of success, taking advantage of a tax incentive, even while accepting to be closely watched by the tax authorities. This fiscal envy overlaps with the tiresome media whining about emigrants, returnees, and anyone trying to improve their life by moving… a national media sport in Italy.
Within this broader picture, I would have also brought up the topic of investor visas (which I find brilliant in scope), a completely different matter from the Maltese or Cypriot passports-for-sale… another story entirely.
We can certainly debate—vigorously, even—whether these measures might benefit a few and seem distorted, but I’m confident your frustration isn’t aimed at foreigners who would never have considered Italy except as a vacation destination. Italians are hardly ever bothered by Americans or Brits buying homes on Lake Como, penthouses in Milan, or masserie in Salento. Quite the opposite...
I can’t believe you don’t recognize that even if their presence is limited to a few years, its economic impact is purely positive. Yes, maybe they invest mostly in lifestyle… but is that our fault if they don’t find anything more promising to invest in? There must be a reason they prefer putting €500,000 into my real estate project that regenerates Italian towns rather than €250,000 into an Italian startup… (in the context of the investor visa). Right? These people do their math carefully. And if they don’t come here… they go somewhere else. Are we supposed to be repelled by them because they’re not “pure enough”? Please.
But you clearly refer to “successful managers and entrepreneurs, at the end of their careers”—clearly Italians—who annoy you because they would return to Italy purely for tax arbitrage, not for patriotic love, or noble motives, or to give back to the country that gave them life. All very noble. I believe you, honestly. And for my part, I feel that my entrepreneurial life—despite many flaws and failures—has been an attempt to give back to my roots. That’s the one success no one can take away from me. All my ventures are focused on this. But that’s my story.
Why should someone feel guilty for deciding—after a global career—to return to Cernobbio or Portofino instead of Palma or Dubai? What’s the scandal? Their intentions? The purity of their soul? Some presumed moral debt to a country that offered them almost nothing at the start of their careers?
Italy is full of old money, which sits idle and doesn’t invest in industry or innovation—and I’m sure you have a better understanding than I do of how much inherited wealth exists in this country. If those people aren’t investing, it’s a problem… perhaps because the system is not business-friendly at all… perhaps because entrepreneurial risk is viewed with hostility… perhaps because there just aren’t that many exciting things to invest in… and capital always follows the sun, even in the startup world… perhaps also because the very few Italian VC funds only bet on a narrow group of “safe” projects, especially when public funds from CdP are involved…
And of course, we must talk about tax justice and crack down on abuse and distortion… but moralizing those who built a career and wealth elsewhere, simply because they come (or return) to enjoy it in Italy, seems like a judgment I wouldn’t expect from a leader of Italian finance. And frankly, that disappoints me, because you’d expect that kind of resentment more on Facebook, among bitter professional moaners.
You’re welcome to respond, if you like—and I assure you I’ve kept myself in check with this comment… but please, don’t repeat the mistake Corriere made: base your judgment on the data, not the gut reaction to a clickbait headline.