Border Municipalities: The Distance That Changes the Taxation of Cross-Border Workers

Context

TL;DR

• New rules define border municipalities within 20 km of Swiss border.
• 72 new Italian municipalities recognized as border areas.
• Old vs. new cross-border workers face different tax regimes.
• Tax benefits lost for workers classified as 'new' cross-border workers.

Key facts

• Definition Issue: Border municipality definition has been ambiguous for over 50 years.
• New Agreement: Bilateral tax agreement entered into force on July 17, 2023.
• Distance Threshold: Border municipality now defined as within 20 km of the border.
• Tax Impact: Late recognition as border municipality can mean fiscal injustice for years.
• New Municipalities: 72 new Italian locations, including Misinto, added to border list.
• Tax Categories: Old cross-border workers pay taxes only in Switzerland; new ones pay in Italy too.
• Union Efforts: OCST and other unions negotiating retroactivity of agreement for affected workers.

The definition of 'border municipality' has always been a hot topic for thousands of Italian workers who cross the Brogeda or Ponte Tresa border every day to reach their jobs in Canton Ticino. For many, a border is not just a geographical line, but a true fiscal barrier that can cost tens of thousands of euros. The story of a family from Misinto, in Brianza, is emblematic in this regard. The wife has worked for twenty years in a Ticino factory but has never enjoyed cross-border worker tax status, paying taxes in Italy. The husband, suspicious of the short distance from the border (less than 20 kilometers), delved into the matter and calculated a potential loss of about 150,000 euros in tax benefits for his wife and 20,000 euros in refunds for the municipality of residence. A considerable sum that highlights the enormous impact of what seems to be a bureaucratic classification.

Matteo Piuri, the mayor of Misinto, gathered these concerns in 2022, driven by a deep 'principle of fairness.' The mayor noted how many residents were forced to move their residence to neighboring municipalities already recognized as border municipalities to access a more advantageous tax regime. This situation has generated not only economic disparities but also a certain administrative confusion, making the issue of border municipalities a real puzzle for workers and local administrations. The problem has further intensified with the entry into force of the new bilateral agreement on the taxation of cross-border workers on July 17, 2023. Since that date, the distinction between 'old cross-border workers' (those who have worked in Switzerland since 2018 and will continue to pay taxes only in the Confederation) and 'new cross-border workers' (who will pay taxes in Italy as well) has made the issue of residence even more critical, directly affecting net salaries. The stakes are high: a late recognition as a border municipality can mean prolonged fiscal injustice for years, with significant repercussions on family budgets and municipal finances.

Operational details

The central knot of this long-standing issue lies in the very definition of 'border municipality,' a concept that has traversed over fifty years of treaties and ambiguous interpretations. The previous agreement from 1974, for example, was surprisingly vague, allowing the Cantons of Ticino, Valais, and Graubünden to use lists of border municipalities developed independently. As revealed by Giordano Macchi, director of the Contributions Division of the Ticino Department of Finance and Economy (DFE), the origin of these lists is shrouded in mystery, possibly dating back to a 1953 convention on shepherding that mentioned cattle traffic and, almost incidentally, 'cross-border workers.' This convention referred to 'border zones' extending 'approximately ten kilometers,' with possible exceptions.

Andrea Puglia, a unionist from OCST, confirms that the Cantons created unilateral lists to fill a regulatory void, which, while not formally included in the 1974 agreement, were tacitly accepted by the Italian authorities. This 'silent consent' has transformed local practices into a sort of unwritten law for decades. The threshold of 20 kilometers, now crucial, made its first explicit appearance only in a 2017 Resolution from the Italian Revenue Agency, described as a 'synthetic expression' of the 'common saying' used for almost half a century. It is only with the new tax agreement, which came into effect last July, that the issue found a normative anchor: a border municipality is now explicitly defined as one located within 20 kilometers of the border. This has led to the inclusion of as many as 72 new Italian locations, including Misinto, in the official list of border municipalities. However, this regulatory clarity has created a new, complex issue: residents of these municipalities, while now recognized as border municipalities, do not automatically fall into the tax category of 'old cross-border workers,' but are considered 'new cross-border workers.' This means that, despite years of work in Ticino and a distance from the border that would justify favorable tax treatment, these workers now have to pay taxes in Italy as well, losing the advantages intended for those who have always enjoyed such status. OCST and other Ticino unions have attempted to negotiate the retroactivity of the agreement for these cases, but the Cantons have so far opposed, creating further frustration and uncertainty for thousands of families.

Useful tools for your case

To verify your within/over 20 km tax scenario, use the net salary calculator and the tax return guide.

Key points

The current situation, while clarifying the geographical definition of 'border municipality,' has left significant questions open regarding fiscal equity, especially for those caught between the old and new regulations. The 'conflict' between legislation and practice has a direct and tangible impact on the paychecks of thousands of cross-border workers operating in the dynamic Ticino job market, from logistics in Chiasso to industry in Mendrisio, from services in Lugano to the cantonal administration in Bellinzona. The worker from Misinto, with twenty years of experience in Switzerland, is a striking example: despite being effectively a long-standing cross-border worker, she is now classified as 'new,' with a less favorable tax regime compared to her colleagues residing in historically recognized municipalities. This disparity generates not only a sense of injustice but also considerable complexity in managing one's fiscal situation.

💡 What to do if your municipality is among the newly recognized?

• Check your status: Carefully verify if your municipality of residence is now on the official list of border municipalities. This information is crucial for understanding your tax framework.
• Determine your category: If you have worked in Switzerland since 2018 or earlier, you should be classified as an 'old cross-border worker.' If you started after, you are a 'new cross-border worker.' This distinction is fundamental for taxation.
• Consult experts: Given the complexity of the matter, it is advisable to consult a tax advisor specialized in cross-border law or a union like OCST in Ticino, which continues to fight for greater equity and for the retroactive application of the agreement in these specific cases. A personalized analysis of your situation is essential to avoid mistakes and maximize the tax benefits to which you are entitled.

The impact of these new rules is not limited to individual workers; Italian border municipalities, including the 72 newly included ones, will also see changes in the flow of tax refunds from Switzerland, which are essential for their budgets. It is crucial to stay informed and act proactively to protect your rights. To better understand how your residence affects your tax burden and what rates apply in your municipality, explore our interactive map of border municipalities and discover all the details about the taxation of cross-border workers. This resource, updated with the latest regulations, will help you navigate the complexities of cross-border taxation. The source of this analysis is tvsvizzera.it, in an article published in February 2026.