On the income front, in 2022 Italy has become a slightly less “unequal” country. This is certified by Istat which estimates how the set of household policies has lowered the Gini index (which measures income gaps) from 30.4% to 29.6%, while the risk of poverty is reduced from 18.6% to 16.8%. The calculations include the results of the main family income measures adopted in 2022: the Irpef reform, the single and universal allowance for dependent children, one-off allowances of 200 and 150 euros, bonuses for electricity and gas bills and the advance of the revaluation of pensions.
With the introduction of the single allowance, the risk of poverty for children under 14 fell by 3.8 percentage points, while it fell by 2.5 for those aged between 15 and 24. This can be read in an Istat study on the redistribution of income in Italy in 2022. The average benefit of the single check is estimated at 1,714 euros (about 143 euros per month) for families who improve their economic situation. The highest average amounts are recorded for households belonging to the second (2,085 euro) and third fifth (1,949 euro) However, the largest share of beneficiary households belongs to the first two fifths who also receive the largest share of expenditure on the total. The benefit in relation to household income is highest in the first three-fifths.
The introduction of the single allowance also causes a worsening of incomes for some types of families. For this subset, the average loss is equal to 591 euros (about 50 euros per month). The highest loss occurs in the richest two-fifths (887 and 951 euros respectively) and in the poorest one (752 euros). The largest percentage of families disadvantaged by the measure and the largest share of losses out of the total are concentrated in the first two fifths; the loss, in relation to household income, is higher in the first fifth. These are cases in which the family unit allowance had a higher amount than the new single allowance.
Irpef reform for the benefit of low incomes
The reform gave rise to a 1.5% decrease in effective average tax rates for the entire population, with more pronounced reductions in three-fifths of families with medium and medium-high incomes. Among the families that improve their situation, the average benefit is lower in the poorest fifth of the population, characterized by the presence of taxpayers with incomes below the threshold of the no-tax area, exempt from tax.
Families in the penultimate fifth absorb 31.7% of the total benefit of the Irpef reform which corresponds to 2.3% of family income. Families that worsen their situation, however, suffer a higher loss in the richest fifth of the population, where more than half of the total loss is recorded.
The analyzes of the current distribution scenario – underlines Istat – only partially take into account the differential impacts between the different income levels of the significant increase in inflation, which will be the subject of further investigation.
With the revaluation of pensions in 2022, +113 euros on average
The advance of the revaluation of pensions for four months of 2022 to counter the negative effects of inflation and support the purchasing power of pensions led to an average benefit of 113 euros for 44.9% of households (0, 3% of income). This can be read in the Istat study on the redistribution of income according to which the benefit is highest in the third fifth (128 euros) and in the penultimate fifth (140 euros), where more than 26% of the total benefit is concentrated. In the central fifth (the third) the highest number of beneficiary families is observed, equal to 51.3% of the total with an average benefit of 128 euros. The poorest fifth had an average benefit of 69 euros with 30.2% of families involved.