Wealthy British nationals are increasingly reconsidering their ties to Dubai as geopolitical tensions in the Gulf, including recent Iranian threats, raise concerns about long-term stability. The emirate, long known for tax-free income and a luxury lifestyle, is seeing some high-net-worth individuals explore relocation options back to Europe. Among the top destinations is Milan, Italy’s financial hub.
A key driver is Italy’s flat-tax regime, introduced in 2017, which allows foreign residents to pay a fixed annual tax of €300,000 on all overseas income. This replaces the earlier €100,000 rate and has steadily increased to €200,000 in 2024 and €300,000 in 2025. Eligibility requires individuals not to have been tax residents in Italy for at least nine of the previous 10 years. Domestic income and capital gains are taxed separately after five years.
The policy has attracted around 5,000 individuals to date, according to estimates from tax specialists. Interest has accelerated following the UK’s abolition of its non-domiciled tax regime, prompting a shift among globally mobile wealthy individuals. Milan, already home to a strong financial services sector, is increasingly seen as offering a comparable business environment to London.
Real estate data reflects this trend. Property prices in Milan have risen by 38% over the past five years. By November 2025, average prices reached €5,171 per square metre, with premium districts such as Brera, Sant’Ambrogio and areas near the Duomo seeing sharper increases. International buyers are estimated to be 30–40% higher than two years ago, with many now seeking permanent residency rather than second homes.
Additional incentives, such as the “return of the brains” scheme, allow qualifying individuals to pay tax on only 50% of their income for five years. Meanwhile, lifestyle factors—international schools, connectivity, and cultural assets, continue to strengthen Italy’s appeal. Despite this momentum, questions remain over the long-term sustainability of Italy’s tax advantages and whether Milan can rival Dubai as a global hub for the ultra-wealthy.
via FT
