MOZMOD – simulating tax and benefit policies for development in Mozambique
MOZMOD model is freely accessible for non-commercial research use. You may request access to the model here.
MOZMOD, the tax-benefit microsimulation model for Mozambique, is a highly versatile yet easy to use tool for policymakers and researchers alike. It allows the user to analyse and compare the effects of different benefit policy scenarios on poverty, inequality, and government revenues. The model applies user-defined tax and benefit policy rules to micro-data on individuals and households and calculates the effects of these rules on household income.
With MOZMOD, users can simulate reforms of the Mozambican tax and benefit system. They can estimate, for example, the number of beneficiaries and analyse the characteristics of the prospective recipients of a hypothetical benefit. MOZMOD also allows users to implement hypothetical income tax and social security reforms and calculate their effects on inequality and the government budget. Existing policies or past policy reforms can be evaluated as well.
MOZMOD can answer for example following questions:
- Do the prospective recipients of a new cash transfer work in the formal or informal sector?
- What is the expected impact of the policy on poverty reduction?
- How much would such a policy cost?
- How could tax rates be increased to offset the additional expenditures on social protection?
- Which type of tax reform benefits the vulnerable population more in terms of poverty and inequality reduction?
Possible policy reform simulations in MOZMOD include for example:
- a universal child benefit,
- a universal pension payment to the elderly
- a youth unemployment benefit
MOZMOD has been developed in cooperation with the Ministry of Economy and Finance of Mozambique and Southern African Social Policy Research Insights (SASPRI). The latest available version of MOZMOD is based on the Household Budget Survey (Inquérito ao Orçamento Familiar, IOF) 2014-15, allowing for representative results at the national level. Policies are simulated for the years 2015-22. The International Labour Organization (ILO) has collaborated with the MOZMOD initiative and supported several training courses over the past years. This support builds on ILO’s social protection expertise and past assistance to the Government of Mozambique, including especially the formation of a national Social Protection Floor for the country.
The first training course on MOZMOD was organized in collaboration with ILO and took place in Maputo in 2017. After the first training, two more training courses were organized for a total of over 50 participants from different government departments to explore how they could use MOZMOD in their daily work. As a result, the MOZMOD team used the model to simulate the impact of a universal child grant on poverty reduction, and the government’s budget. Such simulations contributed to the debate in the Ministry of Gender, Child and Social Action on the pilot of a child grant in Mozambique.
MOZMOD was officially launched for use in 2019. In 2021, 2022 and 2023 standard training events were replaced by so-called research retreats, where participants used the model to answer specific policy questions and then developed policy briefs based on model simulations. The 2021 retreat, organized by the MOZMOD national team together with ILO Mozambique, was the first retreat of this nature under the SOUTHMOD project.
In Mozambique the collaboration with the Ministry of Economy and Finance of Mozambique on SOUTHMOD work is closely linked to the Inclusive Growth in Mozambique – Scaling-Up Research and Capacity programme.