Figures and data in Microreg: A traditional tax-benefit microsimulation model extended to indirect taxes and in-kind transfers

Cite this article as: M. Luisa Maitino, L. Ravagli, N. Sciclone; 2017; Microreg: A traditional tax-benefit microsimulation model extended to indirect taxes and in-kind transfers; International Journal of Microsimulation; 10(1); 5-38. doi: 10.34196/ijm.00148

8 figures and 20 tables

Figures

Figure 1

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Frequency density function for gross income – income year 2012.

*Note*: The total number of taxpayers is 40.5 millions.

*Source*: MicroReg and Ministry of Finance.

Figure 2

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Distribution of taxpayers by gross income classes – net PIT – income year 2012.

*Note*: The total number of taxpayers with positive net PIT is 32.3 million.

*Source*: MicroReg and Ministry of Finance.

Figure 3

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Incidence of education transfers on disposable income by equivalent household disposable income quintile – Tuscany.

*Source*: MicroReg.

Figure 4

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Incidence of health transfers on disposable income by equivalent household disposable income quintile – Tuscany.

*Source*: MicroReg.

Figure 5

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Variation of household disposable income and its components by equivalent disposable income quintiles – Tuscany.

*Source*: MicroReg.

Figure A.1

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Average value of gross income by gross income classes - income year 2012.

*Source*: MicroReg and Ministry of Finance.

Figure A.2

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Average value of PIT by gross income classes - income year 2012.

*Source*: MicroReg and Ministry of Finance.

Figure A.3

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Distribution of VAT revenue by disposable income and expenditure deciles.

*Source*: MicroReg.

Tables

Table 1

Validation of the estimation of cadastral value and IMU – billion euro.

	Tax base (cadastral value)		Total tax paid on buildings (IMU)
	MicroReg	Dip. Fin. and Agenzia del Territorio	MicroReg	Dip. Fin. and Agenzia del Territorio	MEF
Dwelling house	11.6	11.4	3.8	3.3	4.0
Other buildings	5.2	9.3	6.5	9.3	19.7
Total	16.7	20.7	10.3	12.6	23.7

Source: MicroReg, Agenzia del Territorio, Ministry of Finance.

Table 2

Distribution of the dwelling house and the other buildings by gross income classes.

	Dwelling house MicroReg		Dwelling house MEF		Other buildings MicroReg
Gross income classes (euro)	Households (%) with positive cadastral value	Mean cadastral value (euro)	Households (%) with positive cadastral value	Mean cadastral value (euro)	Households (%) with positive cadastral value	Mean cadastral value (euro)
Until 2,500	31.5	415	27.3	452	19.5	374
2,501 to 5,000	32.4	383	18.4	432	17.9	390
5,001 to 10,005	47.3	448	26.9	405	23.8	340
10,006 to 15,000	48.2	474	40.5	430	26.7	379
15,001 to 26,000	54.9	484	48.4	445	27.9	376
26,001 to 29,000	64.5	535	59.9	492	35.9	419
29,001 to 35,000	66.6	544	64.2	526	40.3	480
35,001 to 50,000	67.5	585	67.8	592	41.4	586
50,001 to 60,000	64.9	647	69.8	683	45.9	743
60,001 to 70,000	71.1	775	70.7	730	45.9	626
70,001 to 100,000	72.4	797	72.0	796	53.1	862
100,101 to 150,000	74.2	750	72.8	916	57.3	871
150,001 to 200,000	82.6	816	72.0	1,056	65.7	947
Over 200,000	69.9	807	69.7	1,322	66.4	1564
Total	52.3	501	43.8	491	28.8	435

Source: MicroReg and Ministry of Finance.

Table 3

Taxpayers by prevailing income source (millions).

	MicroReg	MEF	Diff. (%)
Employee income	20.02	20.02	0.0
Retirement income	14.22	14.22	0.0
Self-employed income	4.60	4.60	0.0
Other sources of income	1.69	1.68	0.3
Total	40.54	40.53	0.0

Source: MicroReg and Ministry of Finance.

Table 4

Validation of the model – income year 2012 (billion euro).

	MicroReg	MEF	Diff. (%)
Gross income	790.9	800.4	−1.2
Deductions	23.7	24.0	−1.2
Taxable income	767.2	773.6	−0.8
Gross PIT	205.1	208.2	−1.5
Tax credits by income source	41.5	41.6	−0.3
Family tax credits	11.7	11.5	2.3
Net PIT	151.3	152.3	−0.6
Regional additional income tax	11.0	11.0	−0.5

Source: MicroReg and Ministry of Finance.

Table 5

Redistributive indexes.

	PIT	Regional additional income tax	Total
Pre-tax Gini	0.4234	0.4234	0.4234
Post-tax Gini	0.3714	0.4223	0.3692
Average tax rate	0.1913	0.0139	0.2051
Reynolds-Smolensky net redis. effect	0.052	0.0011	0.0543
Kakwani progressivity index	0.2223	0.0769	0.2125
Reranking	0.0005	0.0000	0.0006

Source: MicroReg.

Table 6

Food share by geographical area.

Area	Expenditure (euro)	Income (euro)	Food share
North West	487.5	2,454.80	0.1986
North East	446.1	2,450.70	0.182
Centre	504.3	2,356.50	0.214
South	506.7	1,893.80	0.2675
Italy	488.7	2,259.20	0.2163

Source: MicroReg.

Table 7

Propensity to consume by income deciles.

Decile	Italy
0	1.26
1	1.07
2	0.96
3	0.93
4	0.87
5	0.83
6	0.78
7	0.76
8	0.69
9	0.56
Total	0.92

Source: MicroReg.

Table 8

VAT tax base and revenue (billion euro).

VAT rate	Tax base	Tax revenue
4%	77.9	3.1
10%	166.8	16.7
22%	174.2	38.3
Total	418.8	58.1

Source: MicroReg.

Table 9

Redistributive indexes.

VAT rate	4%	10%	22%	Total
Pre-tax Gini	0.3009	0.3009	0.3009	0.3009
Post-tax Gini	0.3017	0.3040	0.3059	0.3102
Average Tax Rate	0.0039	0.0208	0.0470	0.0717
Reynolds-Smolensky net redis. effect	−0.0008	−0.0031	−0.0050	−0.0093
Kakwani progressivity index	−0.2116	−0.1426	−0.0931	−0.1139
Re-ranking	0.0000	0.0001	0.0004	0.0005

Source: MicroReg.

Table 10

Redistributive indexes for in-kind transfers – Tuscany.

	Pre-transfer Gini	Post-transfer Gini	Avg. tax rate	Reynolds-Smolensky net redis. effect	Kakwani Progressivity index	Re-ranking
Pre-school	0.2838	0.2825	0.0050	0.0013	0.3186	0.0002
Primary school	0.2838	0.2808	0.0113	0.0030	0.3268	0.0006
Middle school	0.2838	0.2814	0.0068	0.0024	0.4062	0.0004
High school	0.2838	0.2776	0.0134	0.0062	0.5221	0.0007
Total school	0.2838	0.2712	0.0365	0.0126	0.4122	0.0019
University	0.2838	0.2824	0.0127	0.0014	0.2165	0.0014
Pharmaceutical services	0.2838	0.2802	0.0147	0.0036	0.2585	0.0001
Outpatient services	0.2838	0.2806	0.0129	0.0032	0.2544	0.0001
Hospital services	0.2838	0.2792	0.0305	0.0047	0.3250	0.0050
Total health services	0.2838	0.2731	0.0582	0.0107	0.2924	0.0054

Source: MicroReg.

Table 11

Fiscal bonus scheme.

Income (euro)	Fiscal bonus (euro)
Under 24,000	960
Between 24,000 and 26,000	960* [1−(income−24,000)/(26,000–24,000)]
Over 26,000	0

Source: Stability Law for 2015.

Table 12

VAT rates: safeguard clause.

Year	Ordinary rate	Decreased rate
2015	22%	10%
2016	24%	12%
2017	25%	13%
2018	25.5%	13%

Source: Stability Law for 2015.

Table 13

Education and health expenditure (million euro) — Italy.

Year	School	University	Health
2013	41,899	6,997	110,044
2016	41,028	6,931	113,372

Source: DEF 2015 and budget of the State.

Table 14

Redistributive indexes – Tuscany.

	Gini	Theil
Original disposable income	0.2836	0.1450
Disposable income with VAT increase	0.2851	0.1470
Disposable income with fiscal bonus	0.2815	0.1426
Disposable income with variation in school expenditure	0.2838	0.1451
Disposable income with variation in university expenditure	0.2836	0.1450
Disposable income with variation in health expenditure	0.2834	0.1447
Final disposable income	0.2829	0.1445

Source: MicroReg.

Table A.1

Validation of the model - income year 2012 (billion euro).

	Gross income		Deductions		Taxable income		Gross PIT
	Micro Reg	MEF	Micro Reg	MEF	Micro Reg	MEF	Micro Reg	MEF
Piedmont	67.5	66.8	2.0	2.1	65.5	64.4	17.5	17.3
Aosta valley	2.1	2.1	0.1	0.1	2.1	2.0	0.6	0.5
Lombardy	164.5	163.6	5.0	5.1	159.5	157.6	44.0	44.0
Liguria	23.8	25.1	0.7	0.8	23.1	24.2	6.3	6.5
Trento	8.4	8.3	0.3	0.3	8.2	8.0	2.2	2.1
Bolzano	8.5	8.8	0.3	0.3	8.2	8.5	2.2	2.3
Veneto	69.9	71.8	2.0	2.6	67.9	69.0	18.1	18.5
Friuli Venezia Giulia	18.2	19.0	0.5	0.6	17.7	18.4	4.6	4.9
Emilia Romagna	71.4	70.9	2.1	2.5	69.3	68.0	18.6	18.4
Tuscany	54.1	54.4	1.6	1.8	52.5	52.3	13.8	14.0
Umbria	11.6	11.8	0.3	0.4	11.3	11.4	2.9	3.0
Marche	19.7	20.6	0.6	0.8	19.1	19.8	5.0	5.2
Lazio	84.3	83.2	2.6	1.9	81.6	80.7	22.5	22.6
Abruzzo	14.2	15.3	0.4	0.4	13.8	14.9	3.5	3.9
Molise	3.1	3.3	0.1	0.1	3.0	3.2	0.8	0.8
Campania	49.3	50.5	1.5	1.1	47.8	49.3	12.6	12.9
Apulia	38.2	39.0	1.1	1.0	37.0	38.1	9.3	9.8
Basilicata	5.1	5.7	0.2	0.2	4.9	5.5	1.3	1.4
Calabria	18.4	17.0	0.6	0.4	17.8	16.7	4.6	4.2
Sicily	39.4	45.0	1.2	1.0	38.2	44.2	9.7	11.4
Sardinia	19.2	17.9	0.6	0.5	18.7	17.5	4.9	4.5
Total	790.9	800.4	23.7	24.0	767.2	773.6	205.1	208.2

Source: MicroReg and Ministry of Finance.

Table A.2

Validation of the model - income year 2012 (billion euro).

	Tax credits by income source		Family tax credits		Net PIT		Regional additional income tax
	MicroReg	MEF	MicroReg	MEF	MicroReg	MEF	MicroReg	MEF
Piedmont	3.2	3.2	0.8	0.7	13.3	12.9	1.0	1.0
Aosta valley	0.1	0.1	0.0	0.0	0.4	0.4	0.0	0.0
Lombardy	7.0	6.9	1.7	1.6	34.8	34.0	2.2	2.2
Liguria	1.2	1.2	0.2	0.2	4.8	4.9	0.3	0.3
Trento	0.4	0.4	0.1	0.1	1.7	1.5	0.1	0.1
Bolzano	0.3	0.4	0.1	0.1	1.8	1.8	0.0	0.1
Veneto	3.5	3.6	0.9	0.9	13.5	13.5	0.8	0.8
Friuli Venezia Giulia	0.9	1.0	0.2	0.2	3.5	3.6	0.2	0.2
Emilia Romagna	3.3	3.4	0.7	0.7	14.4	13.7	1.1	1.1
Tuscany	2.7	2.8	0.7	0.6	10.3	10.3	0.6	0.6
Umbria	0.7	0.7	0.1	0.2	2.0	2.1	0.1	0.1
Marche	1.2	1.2	0.3	0.3	3.5	3.6	0.2	0.3
Lazio	3.9	3.6	1.1	1.0	17.4	17.6	1.3	1.3
Abruzzo	1.0	1.0	0.3	0.3	2.3	2.6	0.2	0.2
Molise	0.2	0.2	0.1	0.1	0.5	0.5	0.1	0.1
Campania	3.3	3.2	1.9	1.4	8.2	8.6	0.9	0.9
Apulia	2.6	2.7	1.1	1.0	5.9	6.3	0.5	0.5
Basilicata	0.4	0.4	0.2	0.1	0.8	0.9	0.1	0.1
Calabria	1.4	1.4	0.4	0.4	2.9	2.7	0.3	0.3
Sicily	3.0	3.1	1.5	1.2	5.8	7.5	0.6	0.7
Sardinia	1.1	1.1	0.4	0.3	3.4	3.1	0.2	0.2
Total	41.5	41.6	12.8	11.5	151.3	152.3	11.0	11.0

Source: MicroReg and Ministry of Finance.

Table A.3

VAT tax base and revenue (billion euro).

	Tax base				Tax revenue
Region/VAT rate	4%	10%	22%	Total	4%	10%	22%	Total
Piedmont	6.5	14.1	13.7	34.3	0.3	1.4	3.0	4.7
Aosta valley	0.2	0.4	0.4	1.0	0.0	0.0	0.1	0.1
Lombardy	14.5	32.2	33.7	80.4	0.6	3.2	7.4	11.2
Bolzano	0.7	1.5	1.8	4.0	0.0	0.1	0.4	0.6
Trento	0.7	1.6	1.7	4.0	0.0	0.2	0.4	0.6
Veneto	6.2	14.3	15.6	36.1	0.2	1.4	3.4	5.1
Friuli Venezia Giulia	1.7	3.8	4.2	9.6	0.1	0.4	0.9	1.4
Liguria	2.4	5.1	5.1	12.6	0.1	0.5	1.1	1.7
Emilia Romagna	5.8	13.9	15.1	34.8	0.2	1.4	3.3	4.9
Tuscany	5.2	10.9	11.8	27.9	0.2	1.1	2.6	3.9
Umbria	1.2	2.4	2.6	6.2	0.0	0.2	0.6	0.9
Marche	2.0	4.1	4.3	10.3	0.1	0.4	0.9	1.4
Lazio	8.0	17.1	19.1	44.2	0.3	1.7	4.2	6.2
Abruzzo	1.6	3.3	3.5	8.3	0.1	0.3	0.8	1.2
Molise	0.4	0.8	0.7	1.8	0.0	0.1	0.2	0.2
Campania	6.0	11.9	11.6	29.5	0.2	1.2	2.5	4.0
Apulia	4.5	9.0	8.8	22.2	0.2	0.9	1.9	3.0
Basilicata	0.6	1.3	1.3	3.2	0.0	0.1	0.3	0.4
Calabria	2.3	4.5	4.5	11.3	0.1	0.4	1.0	1.5
Sicily	5.6	10.6	10.4	26.6	0.2	1.1	2.3	3.6
Sardinia	2.1	4.1	4.3	10.5	0.1	0.4	0.9	1.4
Total	77.9	166.8	174.2	418.8	3.1	16.7	38.3	58.1

Source: MicroReg.

Table A.4

Test t for mean difference — EU-SILC vs HBS — Centre of Italy.

	EU-SILC				HBS
Variable	Mean	Standard Deviation	Min	Max	Mean	Standard Deviation	Min	Max
Number of rooms	3.4	36.15	1	6	4.26	40.08	1	6
Loan	0.16	12.28	0	1	0.17	12.84	0	1
Number of members	2.28	39.82	1	5	2.25	40.29	1	6
Pc	0.61	16.36	0	1	0.64	16.3	0	1
Internet	0.57	16.62	0	1	0.59	16.73	0	1
Car	0.81	13.24	0	1	0.83	12.72	0	1
Dishwasher	0.51	16.77	0	1	0.61	16.59	0	1
Expenditure	23,850	363,619	7303	185,488	26,369	721,718	2,657	321,923
Number of members <5 years old	0.14	13.37	0	3	0.11	12.42	0	3
Number of members 617 years old	0.25	19.67	0	4	0.26	20.1	0	4
Number of members 1824 years old	0.15	14.31	0	3	0.14	13.57	0	3
Number of members 3469 years old	1.12	28.42	0	4	1.18	27.91	0	4
Householder with low education	0.52	16.77	0	1	0.51	16.99	0	1
Number of managers	0.02	4.9	0	2	0.03	6.57	0	3
Number of self-employed	0.05	7.87	0	3	0.08	10.53	0	3
In property	0.86	11.79	0	1	0.85	12.02	0	1
Number of earners	1.39	26.58	0	5	1.44	25.5	0	5
P-value	0.9439473

Source: our elaborations on HBS and EU-SILC.

Table A.5

Test X² for equality of distribution - EU-SILC vs. HBS.

	EU-SILC		HBS
Geographical area	N°	%	N°	%
North West	7,251,965	28.3	7,270,064	28.34
North East	5,068,067	19.78	5,055,184	19.71
Centre	5,280,629	20.61	5,241,862	20.44
South	8,023,134	31.31	8,083,272	31.51
P-value	1
	EU-SILC		HBS
Number of components	N°	%	N°	%
1	8,281,042	32.32	8,391,562	32.715
2	6,762,685	26.39	6,801,077	26.515
3	5,045,371	19.69	4,841,819	18.876
4	4,226,780	16.5	4,331,686	16.887
5	1,028,286	4.01	1,023,989	3.992
6	202,530	0.79	199,543	0.778
7	52,711	0.21	45,463	0.177
8	15,078	0.06	13,698	0.053
9	6,810	0.03	1,249	0.005
10	2,410	0.01	296	0.001
P-value	1
	EU-SILC		HBS
Number of earners	N°	%	N°	%
0	3,956,170	15.44	2,506,273	9.95
1	13,124,349	51.22	13,378,643	53.13
2	7,109,135	27.74	8,125,715	32.27
3	1,197,490	4.67	1,009,751	4.01
4	215,988	0.84	148,021	0.59
5	20,662	0.08	13,492	0.05
P-value	0.554
	EU-SILC		HBS
Number of females	N°	%	N°	%
0	3,703,284	14.45	3,868,724	15.36
1	14,672,359	57.26	14,380,843	57.11
2	5,418,932	21.15	5,315,662	21.11
3	1,615,631	6.31	1,426,684	5.67
4	191,205	0.75	171,297	0.68
5	17,507	0.07	18,684	0.07
6	4,183	0.02	n/a or 0 ?	n/a or 0 ?
7	693	0	n/a or 0 ?	n/a or 0 ?
P-value	1

Source: Our elaborations on HBS and EU-SILC.

Table A.6

Regression of consumption on households’ characteristics.

Number of observations	19,988
R squared	0.366
R- squared corr.	0.365
Variable	DF	Parameter estimate	Standard Error	T statistic	Pr > \|t\|	Vif
Intercept	1	9.08	0.02	483.94	<.0001	0
Number of rooms	1	0.04	0	10.78	<.0001	1.26
In property	1	-0.26	0.01	-22.41	<.0001	1.17
VHS	1	0.08	0.01	9.54	<.0001	1.14
Loan	1	0.11	0.01	8.43	<.0001	1.14
Box	1	0.13	0.01	14.37	<.0001	1.22
Pc	1	0.14	0.02	8.9	<.0001	4.15
Car	1	0.27	0.01	23.11	<.0001	1.51
Internet	1	0.09	0.02	5.7	<.0001	3.81
Dishwasher	1	0.18	0.01	19.54	<.0001	1.33
Number of members <5 years old	1	0.03	0.01	2.49	0.013	1.22
Number of members 6–17 years old	1	0.03	0.01	4.26	<.0001	1.56
Number of members 18–24 years old	1	0.05	0.01	3.93	<.0001	2.41
Number of members 25–34 years old	1	-0.01	0.01	-0.74	0.461	2.19
Number of members 34–69 years old	1	0.03	0.01	3.93	<.0001	3.03
Householder with low education	1	-0.08	0.01	-5.66	<.0001	3.1
Number of males	1	0.02	0.01	2.91	0.004	2.46
Number of job seekers	1	-0.07	0.01	-5.71	<.0001	2.19
Number of retired	1	0.04	0.01	4.52	<.0001	2.39
Number of not employed	1	0	0.01	0.23	0.82	3.18
Number of managers	1	0.12	0.02	5.4	<.0001	1.06
Number of self-employed	1	0.08	0.01	5.22	<.0001	1.1
Number of members with high education	1	0.11	0.01	10.78	<.0001	2.22
Number of members with medium education	1	0.04	0.01	4.82	<.0001	3.69
Number of earners	1	0.08	0.01	7.45	<.0001	4.37

Source: Our elaborations on HBS.

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Mendeley

Frequency density function for gross income – income year 2012.

Distribution of taxpayers by gross income classes – net PIT – income year 2012.

Incidence of education transfers on disposable income by equivalent household disposable income quintile – Tuscany.

Incidence of health transfers on disposable income by equivalent household disposable income quintile – Tuscany.

Variation of household disposable income and its components by equivalent disposable income quintiles – Tuscany.

Average value of gross income by gross income classes - income year 2012.

Average value of PIT by gross income classes - income year 2012.

Distribution of VAT revenue by disposable income and expenditure deciles.

Validation of the estimation of cadastral value and IMU – billion euro.

Distribution of the dwelling house and the other buildings by gross income classes.

Taxpayers by prevailing income source (millions).

Validation of the model – income year 2012 (billion euro).

Redistributive indexes.

Food share by geographical area.

Propensity to consume by income deciles.

VAT tax base and revenue (billion euro).

Redistributive indexes.

Redistributive indexes for in-kind transfers – Tuscany.

Fiscal bonus scheme.

VAT rates: safeguard clause.

Education and health expenditure (million euro) — Italy.

Redistributive indexes – Tuscany.

Validation of the model - income year 2012 (billion euro).

Validation of the model - income year 2012 (billion euro).

VAT tax base and revenue (billion euro).

Test t for mean difference — EU-SILC vs HBS — Centre of Italy.

Test X2 for equality of distribution - EU-SILC vs. HBS.

Regression of consumption on households’ characteristics.

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Test X² for equality of distribution - EU-SILC vs. HBS.