Universal Basic Income thread

[NineBerry]

A flat tax is progressive when combined with a universal basic income. The basic income basically acts as a tax refund creating a progression. The more you earn the lower the percentage of the tax that is refunded by the fixed basic income. The basic income then also works like a negative income tax for those people with low or no income.

[NineBerry]

The huge advantage of the UBI is:

You get a fixed amount of money on your bank account every month. No need to do anything special. In any other system where you have a negative income tax or where the basic income is taxed, the government first needs to know about what else you are doing before knowing how much money to put on your bank account. This means that the monthly payment is not reliable.

[pErvinalia]

A flat tax is progressive when combined with a universal basic income. The basic income basically acts as a tax refund creating a progression. The more you earn the lower the percentage of the tax that is refunded by the fixed basic income. The basic income then also works like a negative income tax for those people with low or no income.

I'd like to see some figures before I could agree that such a system is "progressive". The flat tax rate would have to be considerably higher than current net tax rates that most people pay to be able to remain revenue neutral. So I'd expect for the lower to middle classes it wouldn't be very progressive. Ultimately, though, it's a matter of degrees perhaps. In most systems there's going to be UBI going to people and then some amount of tax coming back from them (excepting the poor). So the more you tax, the more you can give back. But if you are doing that to too many people, then it defeats the purpose of a progressive taxation system.

[pErvinalia]

The huge advantage of the UBI is:

You get a fixed amount of money on your bank account every month. No need to do anything special. In any other system where you have a negative income tax or where the basic income is taxed, the government first needs to know about what else you are doing before knowing how much money to put on your bank account. This means that the monthly payment is not reliable.

No, that doesn't follow. Your final net taxation rate is determined at the end of a financial year, not before you are paid. There would be no change to the current taxation system we run. In Australia (and I'd assume most advanced economies) we have a PAYG (Pay As You Go) system where the self-employed (compulsory for the employed) can pay an amount of tax as they earn to offset their end of year tax bill. So the framework already exists. It would just be a matter of simplifying it so that more people could do it more easily. And the reality is that as employment continues to fall, less and less people would be paying any tax at all (they'd fall below the tax free threshold). For those that do pay the tax, only those at the bottom end would have to worry much about the amount. As you get higher up into the income brackets, the amount of tax owing on the UBI at the end of the year would become almost unnoticeable.

[rainbow]

... it defeats the purpose of a progressive taxation system.

Progressive taxation defeats the purpose of a progressive tax system.
What happens is that only the filthy rich can afford the tax consultants and the offshore trusts, and the special tax resident status, that leaves them paying less tax than the middle class.

However if you have a BIG, then although you have a flat tax rate, the effect is progressive.
I saw a graph somewhere that illustrates it quite well, but can't seem to find it...
...dither, dither
Getting old, you know?

[pErvinalia]

... it defeats the purpose of a progressive taxation system.

Progressive taxation defeats the purpose of a progressive tax system.
What happens is that only the filthy rich can afford the tax consultants and the offshore trusts, and the special tax resident status, that leaves them paying less tax than the middle class.

That doesn't make sense. A progressive tax system isn't about finding tax loopholes to reduce your tax. It's about literally reducing the standard tax rate for those that earn less. It's true that if you have a loose tax system then the rich can get away with paying less tax than they should. That's not an argument against a progressive tax system, though. The same phenomenon applies to a flat tax system.

However if you have a BIG, then although you have a flat tax rate, the effect is progressive.
I saw a graph somewhere that illustrates it quite well, but can't seem to find it...
...dither, dither
Getting old, you know?

See if you can find it. I could probably do some back of the envelope calculations to see how the revenue balance plays out, but fuck that, it's too late at night, and my brain is fucking stupid these days.

[Scot Dutchy]

Taxing it has no point. It should be the zero point of taxation and everything above should taxed progressively.

Your two sentences are incompatible. It can't be both not taxed and taxed. What you describe in your last sentence is what I just proposed. It's a pity you seem so fucking woeful at reading what is clearly written.

It is not taxed. It's a pity you seem so fucking woeful at reading what is clearly written.

[rainbow]

See if you can find it. I could probably do some back of the envelope calculations to see how the revenue balance plays out, but fuck that, it's too late at night, and my brain is fucking stupid these days.

http://www.parncutt.org/BIFT1.html

[laklak]

If we're looking at amounts that allow bare survival then what's wrong with poorhouses? Three hots and a cot for all. You want extras, like a warmer blanket or something other than gruel to eat then get a fucking job, slacker. Could even have a TV room (broadcast only, Netflix is for winners) and maybe a ping pong table.

[NineBerry]

We are not looking at amounts that allow bare survival

[pErvinalia]

Taxing it has no point. It should be the zero point of taxation and everything above should taxed progressively.

Your two sentences are incompatible. It can't be both not taxed and taxed. What you describe in your last sentence is what I just proposed. It's a pity you seem so fucking woeful at reading what is clearly written.

It is not taxed. It's a pity you seem so fucking woeful at reading what is clearly written.

"... and everything above should taxed progressively."

You can't even read what you wrote yourself.

[pErvinalia]

See if you can find it. I could probably do some back of the envelope calculations to see how the revenue balance plays out, but fuck that, it's too late at night, and my brain is fucking stupid these days.

http://www.parncutt.org/BIFT1.html

I started reading and hit the tl;dr point after about 3 or 4 paragraphs... I'm thinking a BOTE calculation even this late at night would be easier.. . But I'll leave it open in a tab to read at a later point when I'm less mentally retarded (not convinced that point is particularly imminent).

[Scot Dutchy]

Taxing it has no point. It should be the zero point of taxation and everything above should taxed progressively.

Your two sentences are incompatible. It can't be both not taxed and taxed. What you describe in your last sentence is what I just proposed. It's a pity you seem so fucking woeful at reading what is clearly written.

It is not taxed. It's a pity you seem so fucking woeful at reading what is clearly written.

"... and everything above should taxed progressively."

You can't even read what you wrote yourself.

You cant even read what I wrote.

[pErvinalia]

I quoted what you wrote. You wrote that it isn't taxed. Then you claimed that it is taxed. Then you claimed that it isn't taxed.

[Scot Dutchy]

It should be the zero point of taxation and everything above should taxed progressively.