What is new in the 2026 7% tax towns scheme? Thanks to the April 2026 reform, the 7% regime now covers eligible towns up to 30,000 residents. This adds 80 new qualifying towns to the pool, all with between 20 and 30 thousand inhabitants. The expansion is strongest in Campania, Sicilia and Puglia. No towns were removed from the list in 2026. The full list of 2534 qualifying towns is available on Magic Towns Italy. Italy\u2019s 7% tax regime allows retirees moving to certain small municipalities to pay a flat 7% tax on foreign income for ten years. The scheme currently applies to towns in southern regions such as Calabria, Sicily, Sardinia, Basilicata, Campania, Puglia and Molise, as well as designated earthquake-affected municipalities in central Italy. Certain foreign retirees and returning Italians can now pay a flat 7% tax on all non-Italian income – pensions, dividends, rental yields, even consulting fees – simply by relocating to one of roughly 2,000 small towns in Italy\u2019s south (plus a handful of earthquake-affected communes in central Italy). It sounds almost too good to be true, but the break is written into law and already being used by savvy expats. In this article we…<\/p>\n