The reason that Campionfe is inside Switzerland and receives Swiss government services, and the reason looals do not have to shoulder the obligations of being Swiss are simple. Campione is Italian territory within Switzerland and in this respect differs from Monaco and nearby Liechtenstein. They are sovereign countries. There is another important difference Monaco, Liechtenstein, Sark, the Cayman Islands and similar places are tax havens because they never imposed personal income taxes on their residents. Campione does have rather heavy income tax and tax inspectors, officially at least. But if you keep a low profile you should not have a problem, as Italian income taxes are rarely enforced against foreigners because Campione is, well, Italy and because Italian tax inspectors would have to leave their country to reach Campione. And in all cases, due to the fiscal Lira/Swiss Franc exchange rate, you can end up paying all your due taxes and still only end up with a bill less than one quarter of what Italians would pay were you to decide to file. Only if forced would the current political establishment flex its muscle and send out the tax inspectors, given that Mister Numero Uno has a vested interest in lower levels of taxation. However, if your life just wouldn’t be the same without owning a sizeable mansion, risks can be minimized by holding its title in an offshore corporation and letting your local agent make suitable special arrangements to conceal this ownership and show a minimal equity in me property. Moral от story: as always, Keep a low profile and don’t flaunt your wealth.
Mussolini gave the palace at Stresa to his mistress and then used it for entertaining foreign visitors of state. He brought them to Stresa to enjoy a homely Italian atmosphere. Campione used to have quite a few impressive mansions. Most of the best ones were tom down, giving way to condominiums for tax-exiles. Should you want to buy a run-down mansion in nearby Italy, there are plenty for sale at the price of a condo in Campione. As explain later in this Report, all of Italy is just as much of a tax haven for non-italians as Campione.
The only advantage of Campione is the fact that once in Campione, you are, for all intents and purposes, a resident of Switzerland. (Even the Campione traffic police cars have Swiss license plates.) For some people, this can be an important factor. But if Swiss mail and phones are not terribly important to you, it is possible to live in far grander style a few miles away equally tax free for the price of a small Campione apartment, or even in Italy proper for that matter.
In Italy, tax evasion is the national pastime. The Italian government has such a tough time collecting from its own citizens that it does not bother foreigners living anywhere in Italy – if : they stay out of politics and have no visible business, Italian-source income and investments in Italy. The “tax haven” status of Campione is no different than it is all over Italy. Take a little charming Italian corruption, stir in a tad of admiration for and amiability towards foreigners, inject the comical, total anarchy of the Italian system of government, add a big dose of charm and inefficiency and presto: you discover the recipe for Italy’s general inability to get its act together. Did this change in 1992 when Italy supposedly became integrated with the rest of the EC?
Will it change?
In our opinion, to use one favorite Italian word pronounced “impossibilehr Both Campione and Italy will be good to tax-exiles so long as we stay low profile. Do not own an expensive, ostentatious property in Italy. If change ever comes, it will be the obviously well-off, the Haunters, who get the first and worst tax bills.
Campione’s income tax is actually the same as the Italian income tax but Campione residents are allowed to declare their income in Swiss francs by the Italian government. The benefit of this is that there is a special exchange rate for Campione residents for the Swiss franc which is approximately a quarter of the Swiss franc market value. This means that one’s taxable income is a quarter of what it ought to be. Offsetting your tax with life insurance in Italian Lira from Italy will quadruple the effective deduction for insurance or other deductions.
As with any personal tax haven, Campione is suitable for the person of independent means or the owner of a business that can be run from a Campione house or apartment without a big physical plant or a large staff. To be extra safe, do not exchange money on Italian territory or j allow it to be seen that you are supplying goods or services from Italy. A foreign mail drop, possibly Swiss, may be necessary. There are virtually no offices nor office buildings in Campione.
Most foreigners operate businesses out of their apartments or a second apartment which they rent for office purposes. Some individuals rent office space across the lake in Swiss. Lugano is the third largest banking city in Switzerland. Communications to and from Campione are excellent. As mentioned earlier, the PTT (postal telephone and telegraph) is run by the Swiss government, despite the fact that Campione is technically a part of Italy.
SIP, the Italian phone company, provides a sometimes cheaper service in Campione and is not to be looked down upon since the area is served by the most modem digital exchange.