Published on 12, July, 2020
Don't know how many of you have heard about the small trial of this? Its only a few people but they are given a no questions asked payment of £1600pm for two years on the trial.
I am sure I am not the old one whi thinks this would massivley change their life? I work 38 hours a week and only take home about £1850pm, and every one of those hours is a total slog and a battle againt ASD. I would take 6 months-1 year off and then probably do some voulenteer work doing something I love. Sadly I can't see it coming in any time soon but his would be a game changer for anybody with mental heath issues and physical disabilities. Of course that works as long as there is not massive inflation to go with it and prices remain stable.
What are your thoughts?
Rob
£1600 per month x 45 million adults in the UK = a new cost of £864bn per year.
In the last financial year, total UK tax revenue was £1,017bn.
So you'd need to increase taxes by 85% to pay for this. Who would bother working in this scenario? And then how would the UBI be funded?
Amerantin (former member) said:So you'd need to increase taxes by 85% to pay for this. Who would bother working in this scenario? And then how would the UBI be funded?
On surface level it sounds like it takes all the money everyone worked for away but, in a way, essential living costs already does that. Rents/mortgage, food, bills etc. leaves people with little left afterwards. In the hypothetical scenario of UBI people more or less gets those covered working or not from this UBI and so those who work are working for that additional disposable income on top.
If we take minimum wage of £10.42, do 40 hour weeks for 52 weeks you have an income of £21,673
The 1,600 monthly UBI works out £19,200.
If a person with UBI was still continuing working those 40 hours with 85% tax on the whole lot would make the £19,200 + £3,250 for a total take home of £22,450. So, they'd be better off for disposable income but if they chose to work less or not at all they'll likely still have their basic living costs covered. Now, that £3,250 sounds bad if you were to frame it as 'you work for about than £1.50 an hour!' but in a way you need to view those pay packets like pure profit with expenses removed. If you took away your living expenses from your wage you'll find your hourly rate also sounds much less exciting. If anything it could incentivise work more as you know you're working for the extra things you want in life rather than to stay alive and have shelter.
I'm not necessarily in favour of UBI outright and I'm not sure it would have the desired effects in the UK practically, even if it sounds like it should in theory but just offering another perspective on a frightening sounding tax rate on work incentives.
I think one of the concerns though is that you then become more dependent on that UBI so if the government wanted to exercise some level of control they have the majority the income of a lot of people in their hands. Do something 'wrong'? Sanction you directly through your UBI before it even reaches you. Refuse your payments until you agree to do whatever it is the government wants to implement etc.
I think I'd be more in favour of a lower rate UBI, one that alone might not be enough to cover you but gives people on low incomes some breathing room and a safety net but you've still gotta do some kind of work.
There are some fundamental problems with that logic:
Tax these people at ridiculous rates and they’ll simply leave or find ways around it.
Also, the median wage in the UK is over £34k, not £22k.
I get that, the point is UBI would have to be funded and no where in the world has figured out how to do it.
I wasn't including the top 10%/1% because your comment was "who would bother working" so I was going off of how that 85% tax with UBI would apply for your typical working everyman.