For years, the large crowds of Italians attending the annual commemoration of former Prime Minister Bettino Craxi, who is buried in the city of Hammamet in northeastern Tunisia, have attracted attention. The reason, according to Italian officials? They reflect a growing number of pensioners choosing to swap Italy’s high taxes for a more comfortable and peaceful retirement in Tunisia.
This growing influx of Italian pensioners is expected to continue, driven primarily by the country’s preferential tax system, which positions it somewhere between a tax haven and paradise.
Tunisia, which has been more commonly in the European spotlight for its role in irregular migration, is now being described as a “phenomenon” and an “exception” in official reports, research papers, and the media. This new narrative is the result of two key developments. First, there has been a 113.5% increase in the number of Italian pensioners living in Tunisia over the last five years, according to a memorandum from the Italian National Institute for Social Security (INPS). Second, this increase comes at a time when other popular retirement destinations, such as Spain and Portugal, have seen a noticeable decline.
According to the same INPS memorandum, Tunisia now ranks second among 165 countries where more than €1.5bn is paid annually to over 350,000 Italian pensioners living abroad—a trend popularly referred to in Italy as the “grandparent flight”. Official figures show that, on average, one pensioner leaves Italy every day.
This phenomenon has given rise to a lucrative industry. As the INPS notes, “commercial enterprises,” including domestic and international travel agencies, are actively encouraging pensioners to emigrate by highlighting the economic and social benefits of retiring abroad and transferring pension income to countries with lower tax rates.
'Grandparent flight'
While Italian retirees are spread across more than 160 destinations, the largest numbers are found in the Mediterranean islands and major European cities. This group represents approximately 2.5% of Italy’s 17 million pensioners. Despite its emergence alongside broader debates about irregular migration, the phenomenon has garnered increasing attention from political, social, academic, and media circles.
Understandably, given the demographic involved, this so-called “retirement tourism”—or “grandparent flight”—is being discussed from social, cultural, and ethical angles, as well as from an economic perspective. A recent report by Giornale Diplomatico, for example, warned of the “highly significant” economic and social consequences of Italy’s growing exodus of retirees.
Taxation is considered a cornerstone of the decision to ‘flee’ Italy, and often the most attractive or decisive factor in the choice of where to settle. In simple terms, migration is seen as a way to escape the ‘monstrous’ Italian pension tax system in search of more favourable regimes.
The Italian state levies a 23% tax on pensions below €15,000 a year, rising to 25% on incomes up to €28,000, and 35% for those up to €50,000. Pensions above €50,000 are taxed at 43%. For a modest €1,000 monthly pension, this equates to around €300 in monthly reductions, leaving the elderly with barely enough to live on.
The newspaper Il Sole 24 Ore summarised this trend by noting that retirees realised they could increase their effective income by not paying taxes in Italy. It also noted that this has led to significant flows of retirees to destinations with more favourable tax laws, including Portugal, Spain, Bulgaria, Croatia, Albania—and increasingly, Tunisia.
