Analysing the Distributional Implications of the 2022 Policy Measures for Malta

• Working paper
• Nov 2022
• Said Riana , Vella Stephanie
• Malta

Abstract

This research paper examines the redistributive impact of the main social measures that were introduced during 2022 in Malta. These measures include: an extension of the in-work benefit, a one-time payment to mitigate the impact of inflation, a revised supplementary allowance, a weekly increase in pensions of €3.51, a €50 increase in the grant given to the elderly, a tax rebate to pensioners, a tax refund to employees and a tax reduction on part-time income from 15 per cent to 10 per cent.
In order to assess the effect of these measures on the income distribution and the at-risk-of-poverty rate we use EUROMOD, which is a tax-benefit micro-simulation model. Overall, the results presented in this paper indicate that the implementation of these various social measures contribute to a decrease in the poverty rate in all cohorts of the population whilst also improving the income distribution across the population, implying that income inequality is reduced.