> By reversing that, you could make negative income tax payments year-round rather than at tax return time.
Withholding adjustments would help those in low-paying jobs, part time workers, etc. But how does it address temporary or long-term joblessness without requiring individuals to self-fund until refund time?
> A negative income tax is basically equivalent to a basic income funded with a progressive income tax.
I disagree. The funding structure is substantially similar -- some people pay more in taxes than they receive. However, by only distributing the payments to a subset of the population, there is a social stigma associated with receiving benefits. With a universal payment, there is no stigma.
Consider food stamps. The funding structure is set up so some people pay more in taxes than they get from food stamps, and some pay less. But because only some people receive food stamps, there is a stigma associated with them. By contrast, consider the Alaska dividend, which is given equally to every citizen, regardless of income. There is no stigma associated with receiving or using an Alaska dividend. It isn't seen as welfare, but as a right.
> However, by only distributing the payments to a subset of the population, there is a social stigma associated with receiving benefits. With a universal payment, there is no stigma.
People aren't so naive that they would ignore the fact that their basic income is being immediately taken out of their pockets to pay for other people's basic incomes.
Certainly. With a tax-based universal basic income, the vast majority of individuals would be net beneficiaries.
As of 2011, an individual paying >$12k/yr in USA federal taxes is in the top 25%. [0] With a basic income of $1k/yr, anyone in the bottom 75% would effectively be receiving a 100% refund of all taxes, not only the funds earmarked for BI.
There is also the option of voluntary basic income systems, which have the advantage of being immediately implementable. [Disclosure: currently developing a voluntary basic income project/study]
Agreed, something different would have to be done for the jobless.
I only claim economic equivalence, not political or marketing equivalence. On the other hand, we already have a negative income tax for working people (the earned income tax credit) and no national basic income, so maybe the marketing advantages aren't a slam dunk.
Withholding adjustments would help those in low-paying jobs, part time workers, etc. But how does it address temporary or long-term joblessness without requiring individuals to self-fund until refund time?
> A negative income tax is basically equivalent to a basic income funded with a progressive income tax.
I disagree. The funding structure is substantially similar -- some people pay more in taxes than they receive. However, by only distributing the payments to a subset of the population, there is a social stigma associated with receiving benefits. With a universal payment, there is no stigma.
Consider food stamps. The funding structure is set up so some people pay more in taxes than they get from food stamps, and some pay less. But because only some people receive food stamps, there is a stigma associated with them. By contrast, consider the Alaska dividend, which is given equally to every citizen, regardless of income. There is no stigma associated with receiving or using an Alaska dividend. It isn't seen as welfare, but as a right.