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It doesn't have to take the form of an annual tax refund. It could take the form of lower, or negative, paycheck withholdings. The hard part is making sure th
by bzbarsky 7y ago
It doesn't have to take the form of an annual tax refund. It could take the form of lower, or negative, paycheck withholdings. The hard part is making sure that people don't end up owing a bunch of money at tax time, of course, because they're not going to have it lying around.
- zhoujianfu 7y agoLooks like we’re all talking about essentially UBI (Universal Basic Income) here... which I at least think is the solution to a lot of this!
- bzbarsky 7y agoThere's a difference between UBI and something like EITC, in that UBI applies to all adults, whether working or not, whereas EITC is explicitly targeted at people who are employed but do not make what one would consider a "living wage" based on their situation (number of kids, etc). Depending on the structure of the rest of the tax system and on whether the UBI phases out or not, the effective marginal tax rates can also be quite different, though this part can be massaged to make the two options look identical, I suspect. But the core of the difference is whether employment is explicitly encouraged (EITC) or not (UBI).