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Finland experimenting on giving citizens free money (USD 660) as basic income Watch

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    Where will the extra money come from?
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    (Original post by paul514)
    You’re argument is also achieved by lowering taxes for everyone but the rich and unconditional welfare payments at a higher rate surely?
    Well, no. Firstly, the point is that that's more difficult to administrate than just giving it to everyone. Also, your way is less redistributive. Normally that wouldn't bother me but essentially the point, to me, of a UBI is that if you're going to have a state which aims to redistribute wealth and provide welfare you might as well do it on an efficient basis.

    So if you gave everyone the UBI, but removed the personal allowance (say), maybe with a slightly higher basic rate of tax, most people would be better off, but the poorer you are the more better off you would be. If you just lowered taxes and increased unemployment benefit the poorest workers wouldn't see much benefit, and may see a greatly reduced incentive to work.

    This is actually an important point, because people often say a UBI would reduce incentives to work. Universal Credit is a (flawed) attempt to grapple with the problem that for those moving into work, removal of benefits mean that they face eye-watering effective marginal tax rates. If it's not conditional on whether you work or not, your marginal tax rate is always just the tax rate, so the unemployed face no more an incentive to not work those of us in full-time work face to not take overtime.
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    (Original post by Rinsed)
    Well, no. Firstly, the point is that that's more difficult to administrate than just giving it to everyone. Also, your way is less redistributive. Normally that wouldn't bother me but essentially the point, to me, of a UBI is that if you're going to have a state which aims to redistribute wealth and provide welfare you might as well do it on an efficient basis.

    So if you gave everyone the UBI, but removed the personal allowance (say), maybe with a slightly higher basic rate of tax, most people would be better off, but the poorer you are the more better off you would be. If you just lowered taxes and increased unemployment benefit the poorest workers wouldn't see much benefit, and may see a greatly reduced incentive to work.

    This is actually an important point, because people often say a UBI would reduce incentives to work. Universal Credit is a (flawed) attempt to grapple with the problem that for those moving into work, removal of benefits mean that they face eye-watering effective marginal tax rates. If it's not conditional on whether you work or not, your marginal tax rate is always just the tax rate, so the unemployed face no more an incentive to not work those of us in full-time work face to not take overtime.
    Ok so effectively it doesn’t change the circumstances much for the workers due to removal of other forms of taking money from them?
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    (Original post by paul514)
    Ok so effectively it doesn’t change the circumstances much for the workers due to removal of other forms of taking money from them?
    I didn't say that at all. It entirely depends how you set it up and there are a lot of different things you could do. But the lowest paid workers they already pay very little tax because of the personal allowance. The scope to help them out by cutting taxes is now fairly low.

    In the situation where you got rid of the personal allowance, someone earning £12k might pay 20% in income tax on all of that, which is like £2.4k, whereas before they would have paid a few hundred, so they're like £2k worse off. But if they get a £7k UBI (say) they're like £5k better off. You simply cannot do that by cutting taxes.

    Moreover, they're £9.6k better off than they would be not working.

    I know there are other taxes and this is only a rough illustration, but oh well.

    We probably would need to raise the basic tax rate so there would be a break-even point somewhere, which seems entirely reasonable to me.
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    Now we need to kill the commies once again
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    (Original post by Rinsed)
    I didn't say that at all. It entirely depends how you set it up and there are a lot of different things you could do. But the lowest paid workers they already pay very little tax because of the personal allowance. The scope to help them out by cutting taxes is now fairly low.

    In the situation where you got rid of the personal allowance, someone earning £12k might pay 20% in income tax on all of that, which is like £2.4k, whereas before they would have paid a few hundred, so they're like £2k worse off. But if they get a £7k UBI (say) they're like £5k better off. You simply cannot do that by cutting taxes.

    Moreover, they're £9.6k better off than they would be not working.

    I know there are other taxes and this is only a rough illustration, but oh well.

    We probably would need to raise the basic tax rate so there would be a break-even point somewhere, which seems entirely reasonable to me.
    I was more thinking about the middle earners when making the comment but yea I see the point.

    Is it not still simple to administer by making a cut off though at say higher rate payers therefore saving money or making it higher than it would otherwise of have been for the rest of the people?
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    I like Finland. Just does its thing.
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    (Original post by HucktheForde)


    i can think of the upside of this, its better for citizens to get social welfare in forms of cash instead of services (socialized healthcare and stuff) since it puts the responsibility to spend it wisely back into the hands of the people hence removing the risk of government wastage. I much rather money is given back directly to the people rather than spend on drone strikes and senseless wars.

    downside is ... well it will only last until you run out of other people's money to spend.



    also... in the video : anarchist getting money from the government?????
    This assumes everyone is a responsible citizen and is miraculously responsible with money overnight and no-one will try to fleece it from them or con the system.

    Yup. That seems like it will work.
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    (Original post by Tiger Rag)
    Where will the extra money come from?
    from removing of all other benefits. Keep this and this only .
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    (Original post by HucktheForde)
    from removing of all other benefits. Keep this and this only .
    I don't see how that would save money.
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    (Original post by paul514)
    I was more thinking about the middle earners when making the comment but yea I see the point.

    Is it not still simple to administer by making a cut off though at say higher rate payers therefore saving money or making it higher than it would otherwise of have been for the rest of the people?
    Yea I mean, the more you raised the basic rate the lower the break-even point would be. But I imagine it would be set at least so that higher rate payers would be no better off.

    I mean, you could. But it'd be easier to just raise the tax rate so they were no better off.

    Or just give everyone an effective tax cut, I'm cool with that too.
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    (Original post by Tiger Rag)
    I don't see how that would save money.
    if all you want is to save money, then scrap everything and provide no social welfare at all.
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    (Original post by HucktheForde)
    if all you want is to save money, then scrap everything and provide no social welfare at all.
    You're missing my point. It has to come from somewhere. So, where?
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    (Original post by Tiger Rag)
    You're missing my point. It has to come from somewhere. So, where?
    what? just cut all the benefits if you want to save money. Those welfare stuff costs a lot.
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    (Original post by HucktheForde)
    what? just cut all the benefits if you want to save money. Those welfare stuff costs a lot.
    Which benefits JSA is only 1% of the welfare bill.
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    (Original post by shadowdweller)
    I think it's a good idea, personally. The way the benefit system here is structured often seems to mean that people who actually need it are penalised, and those who are taking advantage of the system don't lose out anything more. In theory it should also help with quality of life for those on the basic income system as they don't have rigorous criteria to meet to actually get a liveable income.
    Yep my pal who has serious mental health problems he was sectioned for, serious diabetes that has caused strokes and seizures gets zero money from benefits so has to survive on 8 hours minimum wage job per week.
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    (Original post by paul514)
    Which benefits JSA is only 1% of the welfare bill.
    Yea but housing benefit is 10%, pensions are 42%, 'Family benefits, income support & tax credits' is 18%. UBI could replace at least a good old chunk of this stuff.
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    .... edit as the comment didn’t even appear and I can’t remember now
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    (Original post by HucktheForde)
    what? just cut all the benefits if you want to save money. Those welfare stuff costs a lot.
    Sigh
 
 
 
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