Is Universal Basic Income the way forward?

Mister Know It Not

Geuze wrote: »

As stated earlier in this thread, automated trucks to deliver to Spar in Mullinahone? Over Irish roads? We'll be waiting.

The Manna drone delivery in Oranmore is staffed, two people travel to each house in a car, to meet the drone.

This is about projecting current trends into the future, so yes, "we'll be waiting". But not indefinitely. It's not like these trends and the state of technology will freeze in their current state.

Geuze

JimmyVik wrote: »

Thinking about this now. If they gave me a UBI of €150 or more per week today I could just start drawing the pension retire today.
It would save me another 15 or so years of slogging into work
Might not be a bad idea after all.

You may be referring to a work pension, as the UBI would replace the State Pension.

Nobody would get UBI + State Pension.

Geuze

Can anybody write out a specific list of occupations under threat of automation?

JimmyVik

Geuze wrote: »

You may be referring to a work pension, as the UBI would replace the State Pension.

Nobody would get UBI + State Pension.

Thats fine.
If i get €150 plus what ive stuck in my pension already, that will see me through. And the best part is because I would be retiring in my late 40s/ early 50s, is that I wouldnt be taxed anymore in oreder to pay for it, because I wouldnt be working.
Whats not to like

storker

Mister Know It Not wrote: »

This laserlike focus, for example on this board, on how some people may be abusing the current system seems entirely out of place when dealing with this global problem.

The biggest problem with UBI: no more dole-bashing threads.

Thelonious Monk

JimmyVik wrote: »

Thats fine.
If i get €150 plus what ive stuck in my pension already, that will see me through. And the best part is because I would be retiring in my late 40s/ early 50s, is that I wouldnt be taxed anymore in oreder to pay for it, because I wouldnt be working.
Whats not to like

Yeah, what's not to like? Do you not think we should be working towards a society where we don't all need to work all the time? The current system is all kinds of wrong and we need to do things differently sooner or later.
Are you just worried that people will freeload?

Geuze

JimmyVik wrote: »

Thats fine.
If i get €150 plus what ive stuck in my pension already, that will see me through. And the best part is because I would be retiring in my late 40s/ early 50s, is that I wouldnt be taxed anymore in oreder to pay for it, because I wouldnt be working.
Whats not to like

All income is taxable.

UBI requires a 45% income tax, you would pay 45% income tax on the pension income.

storker

defrule wrote: »

The problem I see with UBI is that, if we don't solve housing then rent will just go up by the amount of UBI.

UBI doesn't mean everyone's income becomes income + UBI. It's more likely that UBI would replace part of that income e.g. be reduced or eliminated tax free allowances. It would replace unemployment benefits, not be an add-on to them.

storker

JimmyVik wrote: »

Thinking about this now. If they gave me a UBI of €150 or more per week today I could just start drawing the pension retire today.
It would save me another 15 or so years of slogging into work
Might not be a bad idea after all.

Sounds good, and you'd be freeing up a position for someone who wants it. If after a year or so the novelty wears off, you can take a part-time gig if you feel like it and your UBI wouldn't be threatened, nor would you need to inform anyone. As long as the taxman gets to wet his beak, of course.

JimmyVik

Geuze wrote: »

All income is taxable.

UBI requires a 45% income tax, you would pay 45% income tax on the pension income.

ah wait now.
Nobody said that was part of the deal.
Everyone on this thread has basically been saying its free money and noone but the rich would be paying for it.
You mean they would tax my pension to pay for it too?
The deal is off.
Keep your UBI and stick it where the sun doesnt shine

JimmyVik

storker wrote: »

UBI doesn't mean everyone's income becomes income + UBI. It's more likely that UBI would replace part of that income e.g. be reduced or eliminated tax free allowances. It would replace unemployment benefits, not be an add-on to them.

Would it not be an add-on to rent allowance, medical cards and those sorts of benefits? OR would they get replaced by it too.

Geuze

JimmyVik wrote: »

ah wait now.
Nobody said that was part of the deal.
Everyone on this thread has basically been saying its free money and noone but the rich would be paying for it.
You mean they would tax my pension to pay for it too?
The deal is off.
Keep your UBI and stick it where the sun doesnt shine

I can't work out whether you are joking or not.

A UBI has to be paid for, obviously. Some studies suggest a single flat income tax, and the SJI costings suggest 40% is required for UBI of 150 per week.

I suggest 45% would be needed for a UBI closer to 200 per week.

Also, all tax credits are abolished.

Geuze

JimmyVik wrote: »

ah wait now.
Nobody said that was part of the deal.
Everyone on this thread has basically been saying its free money and noone but the rich would be paying for it.
You mean they would tax my pension to pay for it too?

All pension incomes are already taxed.

It's just that with a UBI, they would be taxed more, to pay for the UBI.

storker

JimmyVik wrote: »

Would it not be an add-on to rent allowance, medical cards and those sorts of benefits? OR would they get replaced by it too.

Ideally yes, because part of the financial justification for UBI is the cost reduction in administering it. If it's necessary to pay people to process applications for other benefits, then that saving is lost. The same applies to ideas of providing UBI via tax credits etc, missing much of the point. Of course, the question then becomes how much do you the basic UBI payment? I'm guessing somewhere higher than just unemployment benefit by itself.

Geuze

JimmyVik wrote: »

Would it not be an add-on to rent allowance, medical cards and those sorts of benefits? OR would they get replaced by it too.

The cash benefits are replaced with UBI.

What might happen to non-cash benefits isn't clear, that would have to be considered / negotiated.

JimmyVik

Geuze wrote: »

All pension incomes are already taxed.

It's just that with a UBI, they would be taxed more, to pay for the UBI.

45% on all income is a lot of tax though.
Good luck getting people who have saved for 40 years into their pension to go for that.

storker

JimmyVik wrote: »

45% on all income is a lot of tax though.
Good luck getting people who have saved for 40 years into their pension to go for that.

Those people who have saved for 40+ years will also receive UBI - that's the "Universal" bit.

JimmyVik

storker wrote: »

Those people who have saved for 40+ years will also receive UBI - that's the "Universal" bit.

So lets say I retire at 60 as is in my contract.
If my pension earns me €35K per year I keep about €29k
So thats €6k I pay in taxes or €115 per week.

So with UBI I get €150 a week,

but it I have to pay 45% tax on my €35k which is €15750.

So I gain €150 from the UBI, but I am now paying €302 in tax.
I am actually €187 worse off per week even though im getting UBI. Plus I dont even get the contributory state pension when I reach 68, so im far worse off at that point even.

storker

JimmyVik wrote: »

So lets say I retire at 60 as is in my contract.
If my pension earns me €35K per year I keep about €29k
So thats €6k I pay in taxes or €115 per week.

So with UBI I get €150 a week,

but it I have to pay 45% tax on my €35k which is €15750.

So I gain €150 from the UBI, but I am now paying €302 in tax.
I am actually €187 worse off per week even though im getting UBI. Plus I dont even get the contributory state pension when I reach 68, so im far worse off at that point even.

We don't know what the UBI payment would be, and we don't know what tax rate would be required to pay for it, because we don't know how much would be saved in administration costs, but any change to the tax/benefits system results in net winners and losers so, yes, perhaps.

However...a big part of the idea behind UBI is increased economic activity by people who will always be better off if they work. No more dole trap. Increased economic activity means increased exchequer returns which in turn means less would need to be taken out of your pension. That's the theory.

Geuze

JimmyVik wrote: »

So lets say I retire at 60 as is in my contract.
If my pension earns me €35K per year I keep about €29k
So thats €6k I pay in taxes or €115 per week.

So with UBI I get €150 a week,

but it I have to pay 45% tax on my €35k which is €15750.

So I gain €150 from the UBI, but I am now paying €302 in tax.
I am actually €187 worse off per week even though im getting UBI. Plus I dont even get the contributory state pension when I reach 68, so im far worse off at that point even.

35k pension now at age 60

35k@20% = 7000 tax, less tax credits 3300 assuming single

Tax due is 3,700
PRSI 4% is 1,400
USC is too messy for me
So 5,100 + USC, I will assume your 6k is correct

Net = 29k


35k pension with UBI of 200 pw assumed/ 45% tax

0.55*35k = 19,250
Plus 200 pw UBI = 10,400 pa
Net is 29,650

You are up 650 per annum

Geuze

JimmyVik wrote: »

So lets say I retire at 60 as is in my contract.
If my pension earns me €35K per year I keep about €29k
So thats €6k I pay in taxes or €115 per week.

So with UBI I get €150 a week,

but it I have to pay 45% tax on my €35k which is €15750.

So I gain €150 from the UBI, but I am now paying €302 in tax.
I am actually €187 worse off per week even though im getting UBI. Plus I dont even get the contributory state pension when I reach 68, so im far worse off at that point even.

I will double check your sums.

No UBI = pay net tax of 115 pw

UBI = pay tax of 303 in tax, but receive 150 UBI, so net tax is 153

Your sums are wrong, you are worse off by 37 per week.

Note that we are assuming 45% and 150 pw here.

JimmyVik

Geuze wrote: »

I will double check your sums.

No UBI = pay net tax of 115 pw

UBI = pay tax of 303 in tax, but receive 150 UBI, so net tax is 153

Your sums are wrong, you are worse off by 37 per week.

Note that we are assuming 45% and 150 pw here.

How does it work out when I hit 68?

Geuze

Nothing happens at 68, assuming UBI = State Pension.




Well, maybe something does happen.

In the SJI 2016 costings, they had UBI as follows:
https://www.socialjustice.ie/content/policy-issues/costing-basic-income-ireland

18-65 = 150 pw
66+ = same as State Pension = 230 pw

saabsaab

So our experiment with UBI is coming to an end.