INTRODUCTION Contributed by: Basil Zirinis and Elizabeth Kubanik, Sullivan & Cromwell LLP
“flat tax” regime; however, in August 2024, the Italian government approved a measure that doubled its flat tax from EUR100,000 to EUR200,000 per year. Swit - zerland’s lump-sum tax regime is available to foreign - ers who live but do not work in Switzerland (although the lump-sum taxation system is not available in all cantons). Unlike the Greek and Italian regimes, Swit - zerland calculates a taxpayer’s tax base from the tax - payer’s lifestyle expenses. Spain’s “Beckham” regime provides preferential tax treatment to foreigners who acquire tax residence in Spain for work purposes. Portugal’s expatriate tax regime – the “Non-Habitual Resident” (NHR) tax regime – ended in 2023 and has been replaced by the somewhat more restrictive “Tax Incentive for Scientific Research and Innovation” (IFICI), which provides for a flat tax rate of 20% on eligible income from Portu - gal and exemptions on professional foreign-sourced income. Furthermore, in April 2025, the United Kingdom abolished its longstanding “non-dom” tax regime. All of these regimes are much more complex than they appear at first, and comprehensive tax plan - ning with local experts is vital. Global conflicts Russia’s military invasion of Ukraine in February 2022 has caused many hundreds of thousands of deaths and displaced many millions of people. The ongoing conflict continues to have a resounding international impact. In response to the crisis, the European Union, the USA and other countries have imposed economic sanctions against Russia, with broad international economic ripple effects. These sanctions have had a significant impact on private client advisers, who must keep abreast of changing guidance in relation to clients with ties to Russia. Individual violators of sanctions are generally subject to strict liability and face stiff penalties. Long-standing tension in the Middle East boiled over in October 2023, when Hamas launched an attack on Israel. The ongoing conflict has since escalated into one of the most significant in the region in decades, causing tens of thousands of deaths and displacing
millions of people. The conflict has since spread to Lebanon and Iran. Private client advisers will need to continue to monitor the political and economic environment surrounding the conflict and the effect on clients’ patterns of global migration as a result. Elections and political risk 2024 was a landmark year globally for political elec - tions, and the impact of these elections has unfolded in the first part of 2025. In the United Kingdom, the Labour Party defeated the Conservative Party in the July 2024 general election, and in 2025 sweeping tax changes were made, particularly with respect to the “non-dom” tax regime. In the USA, President Donald Trump returned to office for a second term. Since tak - ing office, President Trump has introduced an eco - nomic agenda focused on tax cuts and the imposition of tariffs, impacting private clients with multi-jurisdic - tional wealth. Recent years have seen increased political volatility worldwide, highlighted by the reintroduction of broad- scale tariffs in international trade, a rise in national - ism and the continued consolidation of authoritarian regimes around the globe. The socio-economic fall - out resulting from the pandemic, mounting interna - tional conflicts and other societal forces has increased worldwide political turmoil and, in some cases, civil unrest. The risk of nationalisation has increased, and continues to create the need to ensure that private clients separate personal wealth from ownership of companies that can be nationalised, which may prove difficult given that a family’s wealth is often predomi - nantly tied up in its family business. Private client advisers will need to keep abreast of any shifts in power and associated policy to continue to effectively counsel their clients in the face of political change. The global economy The evolving geopolitical landscape and ongoing global conflicts, combined for several years with per - sistent inflation, high global interest rates and turbu - lent economic markets, continue to generate concern regarding an impending recession. This concern has
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