4 ms·
Aren’t NIT and UBI effectively the same thing?
by occamrazor 6y ago
Aren’t NIT and UBI effectively the same thing?
- didgeoridoo 6y agoThink of NIT as steepening the progressive tax rate curve, and allowing it to dip below the y (tax rate) axis for sufficiently low x (income). There exist several “refundable tax credits” today in the US that effectively do this at a small scale, albeit with a lumpy phase-out curve that runs into the same disincentive cliffs as many other welfare programs. UBI, on the other hand, shifts the curve rightward, so everyone’s income is relatively higher and is thus subject to more taxes. (You’d obviously also need to raise taxes overall if your goal is to keep it budget-neutral).
- Aachen 6y agoUBI, universal basic income, is universal. Lowering the tax rate below zero for some people is not universal but only some percentage of the population.
- shawnz 6y ago> Lowering the tax rate below zero for some people is not universal but only some percentage of the population. So what? As long as everyone above the NIT line saves the same dollar amount in tax payments that they would have got from UBI, there's no difference.