well it depends what are you working on. It's not a complete hell but it's true Italy is not so business friendly as it pretends to be, especially when it comes to bureaucracy, laws, services. Things are changing, true, and the situation is far better than it was just 3 years ago. The truth: still a lot has to be done yet. But you may find lots of talented developers, skilled people, educated scientists and here living costs and salaries are cheaper than in other countries. In Milan and other cities in the north some local ecosystems are arising. Think of your business, of your target customers, of your needs. Then it might be worth a try. Just do not expect any help by the government or public administration.
Source: I am italian, and I live in Milan, I am both a consultant helping small businesses and entrepreneur.