# **Table 4. Croatia: Marginal Contributions to Reducing Inequality in 2014 Pensions as Deferred Income Scenario**

||**Size (wrt**|||**Marginal co**|**ntributions**<br>|
|---|---|---|---|---|---|
||<br>**Market Income**<br>**plus pensions)**|**Concentration**<br>**Coeffecient**|**Kakwani**<br>**Coefficient**|**Redistributive**<br>**Effect**|**Poverty**<br>**Reduction Effect**<sup>**5**</sup>|
|**To Disposable Income**|**83.6%**|||||
|**All contributory pensions**|21.5%|0.1979|0.1848|0.1449|0.2049|
|education related benefits|0.1%|-0.1553|0.5381|0.0006|0.0010|
|maternity/parental benefit|0.7%|-0.1926|0.5754|0.0038|0.0039|
|unemployment related benefits|0.3%|-0.1516|0.5344|0.0015|0.0017|
|disability related benefits|0.4%|-0.2067|0.5895|0.0019|0.0021|
|sickness benefits|0.2%|0.0220|0.3608|0.0007|0.0003|
|social asisstance|0.2%|-0.7476|1.1303|0.0021|0.0027|
|childrelated benefits|1.1%|-0.5380|0.9208|0.0109|0.0127|
|other benefits|0.6%|-0.5331|0.9159|0.0049|0.0066|
|**All direct transfers excl contributory pensions**|3.5%|-0.3669|0.7497|0.0276|0.0382|
|**All direct transfers incl contributory pensions**|25.0%|0.1188|0.2639|0.1802|0.2457|
|PIT|-7.1%|0.6878|0.3050|0.0273|-0.0005|
|dir.taxes of agri/fish/hunt/forest|-0.1%|0.2947|-0.0880|0.0001|0.0000|
|tax on vacation homes|0.0%|0.3637|-0.0190|0.0000|0.0000|
|tax on motor vehicles|-0.1%|0.3577|-0.0251|0.0000|0.0000|
|tax on vessels|0.0%|0.4904|0.1076|0.0000|0.0000|
|ssc general health|-10.7%|0.4303|0.0475|0.0100|-0.0084|
|ssc occupational health|-0.4%|0.4331|0.0503|0.0003|0.0000|
|ssc employment|-1.2%|0.4460|0.0632|0.0012|-0.0004|
|ssc pensioners health|-0.3%|0.2863|-0.0965|0.0001|-0.0002|
|ssc farmers nonpension|-0.1%|-0.0379|-0.4206|-0.0003|-0.0001|
|**All direct taxes**|-7.3%|0.6773|0.2946|0.0272|-0.0005|
|**All contributions**|-26.4%|0.4339|0.0512|0.0267|-0.0175|
|**All direct taxes and contributions**|-33.7%|0.4865|0.1038|0.0465|-0.0191|
|**To Consumable Income**|**64.6%**|||||
|**All direct taxes**|-7.3%|0.6773|0.2946|0.0315|-0.0073|
|**All contributions**|-26.4%|0.4339|0.0512|0.0246|-0.0581|
|**All direct taxes and contributions**|-33.7%|0.4865|0.1038|0.0461|-0.0598|
|VAT|-17.1%|0.2173|-0.1655|-0.0283|-0.0877|
|excises|-1.7%|0.2366|-0.1462|-0.0030|-0.0116|
|other indirect taxes|-0.2%|0.2445|-0.1382|-0.0004|-0.0005|
|**All indirect taxes**|-19.1%|0.2194|-0.1634|-0.0303|-0.0913|
|**All taxes**|-26.4%|0.3458|-0.0370|-0.0030|-0.0918|
|**All taxes and contributions**|-52.8%|0.3899|0.0071|0.0162|-0.1103|
|**To Final Income**|**84%**|||||
|**All direct taxes and contributions**|-33.7%|0.4865|0.1038|0.0520|-0.0196|
|**All direct transfers excl contributory pensions**|3.5%|-0.3669|0.7497|0.0222|0.0295|
|**All Indirect taxes**|-19.1%|0.2194|-0.1634|-0.0170|-0.0393|
|**Allgross in-kind transfers**|18.9%|-0.0673|0.4500|0.0623||
|**Gross education transfers**|8.2%|-0.1562|0.5390|0.0115||
|pre-primary education|1.3%|-0.0176|0.4004|0.0022||
|primary education|4.4%|-0.2563|0.6391|0.0068||
|secondary education|1.1%|-0.1761|0.5589|0.0046||
|tertiary education|1.5%|0.0373|0.3455|0.0017||
|**Gross health transfers**|10.8%|0.0000|0.3828|0.0435||

Source: own estimates based on PIS and HBS (2014).

Notes:

1. Original income is considered as Market Income plus Pensions

2. Redistributive effect equals the difference between market income Gini and the relevant ending income concept Gini. The shown change is measured in Gini points.

3. Size equals the ratio of the amount collected or spent divided by total market income.

4. Marginal contribution equals the difference between the Gini coefficient of the relevant ending income concept without the intervention in question and the Gini coefficient of the relevant ending income concept (which, of course, includes that intervention). By definition, the sum of the marginal contributions does not fulfill the adding-up principle so it will not be equal to the redistributive effect unless by coincidence. The marginal contribution shown above is measured in Gini points.

5. Poverty Reduction effect based on poverty headcount index using the poverty line of $5.00 per day in 2005 PPP.

20