Sara van Bussel

Milan, Italy’s pulsating hub of finance and fashion, is orchestrating a cultural renaissance, poised to become a global art capital. In July 2025, a transformative tax reform slashed the VAT on art sales and imports from a crushing 22%—Europe’s highest—to a sleek 5%, the continent’s lowest. Paired with a halved import tax from 10% to 5%, this bold fiscal maneuver has positioned Milan as a beacon for collectors, galleries, and dealers, reshaping Europe’s art landscape as global sales dipped 12% to $57.5 billion in 2024. Yet, while the stage is set for Milan to rival London and Paris, I remain skeptical about its long-term prospects, tempered by Italy’s aging collector base and a cultural blind spot in nurturing new generations, even as I hold hope for an influx of international wealth.

The art world’s spotlight turned to Milan when mega-dealer Thaddaeus Ropac, undeterred by
skeptics, opened his seventh gallery in the historic Palazzo Belgioioso in September 2025. “You
must be out of your mind,” peers warned, but Ropac’s gamble heralded Milan’s ascendance. Italy’sDecree-Law No. 95/2025, effective July 1, delivered: a uniform 5% VAT across sales, imports, antiques, and collectibles. Nomisma projects a €1.5 billion surge in art market turnover over three years, with a €4.2 billion economic ripple, including €68 million from art fairs. As collector Claudio Borghi noted on X, “More work in Italy, more revenue for the treasury.” A €50,000 painting, once tax-free for Italy when bought in Paris, now yields €2,500 in Milan, fueling jobs in cataloging, logistics, and restoration.


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Italy’s art market had been stifled by high taxes and arcane export rules, driving auctions to Paris or Vienna. At April’s Miart fair, 600 artists warned Prime Minister Giorgia Meloni of a “cultural desert,” spurring her government’s decisive reform. The 5% VAT aligns with EU Directive 2022/542’s push for competitiveness, undercutting France (5.5%) and Germany (7%). Milan was ripe for this moment. As Francesca Kaufmann of Kaufmann Repetto observes, its contemporary art scene thrives in a “less suffocated” environment than Rome or Venice, where historical weight overshadows innovation. Milan’s synergy with fashion and design has long fostered a dynamic market, now electrified by fiscal incentives.

Milan’s allure is amplified by Italy’s 2017 flat-tax regime, capping foreign income tax at €200,000 for wealthy newcomers, with no wealth tax. The UK’s 2025 abolition of non-dom status has driven over 4,000 high-net-worth individuals to Milan, doubling its affluent population and spiking luxury real estate by 20-30%. These collectors, drawn by inheritance taxes of 4-8% compared to the UK’s 40% or France’s 45%, are enriching Milan’s market with historic depth. “Milan has incredible collectors,” Kaufmann notes, their multi-generational holdings now bolstered by a revitalized market. Galleries report 15-20% sales increases since July, with miart 2025 drawing 179 international exhibitors and Artissima, hosting 189 galleries from 34 countries in 2024, eyeing global stature. Davide Mazzoleni, opening a Milan outpost, calls the tax cut a “game-changer,” while Ropac’s executive director, Elena Bonanno di Linguaglossa, dubs Milan “the most European city in Italy.”

Yet, I am skeptical about the sustainability of this boom relying on Italian collectors. Italy’s population, including its collectors, is aging rapidly, with a median age pushing 46. The collector base, predominantly the last generation of seasoned patrons, is focused on modern art, from
Futurism to Arte Povera. Younger Italians show little enthusiasm for collecting, a trend exacerbated by a glaring gap in education. Italian schools, steeped in Renaissance heritage, rarely venture beyond Arte Povera, leaving contemporary art and its financial potential sidelined. Without a new generation educated to see art as both cultural and economic capital, Italy’s domestic market risks stagnation.


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My hope lies thus in Milan’s magnetic pull for international collectors. The tax cuts, paired with  low inheritance rates, make Milan a haven for global wealth fleeing London’s post-non-dom fallout or France’s high taxes, as French PM François Bayrou laments Italy’s “fiscal dumping.” UBS predicts a 10-15% market rebound by 2026, driven by U.S. and Gulf buyers seeking stable havens.

The secondary market for masters like Lucio Fontana is already heating up, and fairs like Basel and Frieze are eyeing Milan. Giuseppe Calabi of the Apollo Group hails the reform as restoring Italy’s “rightful place,” while Marco Poggiali sees a “market revival.” Sirio Ortolani of ANGAMC
envisions Italy as a “great international hub.” Still, challenges persist: export regulations could slow repatriation, and rents, up 25%, risk alienating locals.

Milan’s moment is a masterstroke of fiscal alchemy, but its future hinges on balance. By 2026, Miart could rival Paris’s FIAC, with galleries multiplying and emerging artists gaining visibility. Yet, without fostering a new generation of Italian collectors, the city’s renaissance may lean heavily on foreign wealth. I hope Milan becomes a vibrant agora, not a glossy enclave, as low taxes move not just money but masterpieces, redefining Europe’s creative economy for a generation.




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Milan’s Moment: Italy’s Tax Revolution Redraws Europe’s Art Map

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