🇳🇱 COUNTRY A Netherlands VS 🇮🇹 COUNTRY B Italy

Under the standard tax system, the Netherlands is cheaper at every income level: €5,450/year at €30,000, €5,800 at €60,000, €7,300 at €90,000, and €7,000 at €150,000. The major exception: Italy's impatriati regime (50% income exclusion for qualifying new residents for 5 years) can make Italy substantially cheaper than the Netherlands for eligible professionals — at €90,000 under impatriati, Italy's total burden drops to approximately €15,000–€17,000 versus the Netherlands' €31,700.

Italy's regime dei lavoratori impatriati (Legislative Decree 209/2023 reform) provides a 50% income exclusion on employment and self-employment income for qualifying individuals who: (1) have not been Italian tax residents for the prior 3 tax years; (2) commit to residing in Italy for at least 2 years; (3) carry out their work activity predominantly in Italy. Duration: 5 years, extendable by 5 years if the individual buys property in Italy or has a minor child. The exclusion applies to IRPEF, regional, and municipal taxes — but not INPS contributions. For a €90,000 earner: taxable income = €45,000, producing IRPEF of approximately €10,560 — making Italy far cheaper than the Netherlands for eligible arrivals.

Italy's regime forfettario is available to self-employed workers and sole traders earning under €85,000/year. It replaces standard IRPEF with a flat 15% tax on a percentage of gross revenue (the coefficient varies by sector — typically 67%–86% of revenue is the taxable base). New business first 5 years: reduced 5% rate. VAT: exempt. Bookkeeping: simplified. For a €60,000 freelancer under forfettario: taxable base ≈ €42,000 (at 70% coefficient); tax ≈ €6,300 at 15% — dramatically lower than both the standard Italian rate (€22,100) and the Netherlands (€16,300). The forfettario provides a major competitive advantage for independent contractors.

Italy's INPS (Istituto Nazionale della Previdenza Sociale) employee contribution is approximately 9.49% of gross salary for most employed workers (lavoratori dipendenti), applied up to an annual ceiling of approximately €50,000. Above the ceiling: a reduced rate applies. The Netherlands: national insurance contributions are embedded within the 36.97% Box 1 rate for income up to €38,441 (~17.9% is the NI component). For a €60,000 Italian earner: INPS = ~€4,745 (at ceiling). For a Dutch earner at €60,000: NI within Box 1 is approximately €6,900. The Netherlands' embedded structure makes direct comparison difficult — but the total Dutch burden at €60,000 is still lower despite the higher NI component.

Italy: listed share capital gains taxed at 26% flat sostitutiva (imposta sostitutiva) — applied at the broker level. Primary residence: fully exempt. Crypto assets (from 2023): 26% flat on gains above €2,000 threshold. Netherlands Box 3: actual returns on investment assets above ~€57,000 taxed at 36% (reformed system). Primary residence: exempt from Box 3. For a €50,000 listed share gain: Italy charges €13,000 flat; Netherlands under Box 3 charges 36% of actual returns — at 7% return on €100,000 invested that's ~€2,520/year. The Netherlands' Box 3 is lower for typical portfolio returns; Italy's 26% is lower for large one-off gains.

Netherlands 30% ruling: 30% of salary excluded from income tax; up to 5 years; available to employees recruited from abroad with scarce expertise; capped at €233,000 salary; employer must apply on behalf of the employee. Italy impatriati: 50% income excluded from IRPEF/surcharges; up to 5 years (extendable to 10 with property purchase or child); available to employees and self-employed; no cap on salary; individual applies independently. At €90,000: Netherlands under 30% ruling reduces Dutch tax to ~€23,000; Italy under impatriati reduces Italian tax to ~€15,000–€17,000. Italy's impatriati provides a higher absolute exclusion percentage and is available to self-employed workers — making it more powerful than the Dutch ruling at equivalent income levels.