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  Reply # 1686086 11-Dec-2016 15:31
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So if you set UBI at (say) $20,000 a year net of any taxation every million people you pay it to will cost $20 billion.

 

Let's say that 65% of the population is over 18 and therefore eligible for Basic.

 

NZ population approx 4.5 million so that makes 2.9 million or thereabouts.

 

So we need around $60 billion a year to cover that. According to the Treasury that is about $10b more than was spent last year on Social Security & Welfare, Health and Education combined. Total core Crown revenue for the same period was $71 billion.

 

It won't be cheap, will it?!

 

 






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  Reply # 1686109 11-Dec-2016 16:13
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Geektastic:

So if you set UBI at (say) $20,000 a year net of any taxation every million people you pay it to will cost $20 billion.


Let's say that 65% of the population is over 18 and therefore eligible for Basic.


NZ population approx 4.5 million so that makes 2.9 million or thereabouts.


So we need around $60 billion a year to cover that. According to the Treasury that is about $10b more than was spent last year on Social Security & Welfare, Health and Education combined. Total core Crown revenue for the same period was $71 billion.


It won't be cheap, will it?!


 



About 58, yeah.

From treasury.govt.nz:

Quote: ''What are the government's main areas of expenditure?
The three largest areas of total Crown expenditure for the 2015/16 financial year were:

Social security and welfare: $28.9 billion
Health: $15.2 billion
Education: $13.8 billion
These figures are taken from the Analysis of Expenses by Functional Classification Total Crown in the Financial Statements of the Government of New Zealand for the Year Ended 30 June 2016. See the Analysis of Expenses for information on other areas of government expenditure - such as defence and transport and communications - and for a comparison with the 2014/15 figures.

What are the Government's main sources of revenue?
The Government's main sources of revenue come from tax, levies, fees, investment income and from the sales of goods and services.

Total core Crown revenue for the 2015/16 year was $76.1 billion. Tax revenue is the major source of core Crown revenue; this totalled $70.4 billion in the 2015/16 financial year.

See the Treasury's tax topic page for more information on tax revenue.''

 
 
 
 


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  Reply # 1686128 11-Dec-2016 17:46
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Geektastic:

 

So if you set UBI at (say) $20,000 a year net of any taxation every million people you pay it to will cost $20 billion.

 

Let's say that 65% of the population is over 18 and therefore eligible for Basic.

 

NZ population approx 4.5 million so that makes 2.9 million or thereabouts.

 

So we need around $60 billion a year to cover that.

 

 

I'm not familiar with Gareth Morgan's UBI but I'm sure that UBI doesn't mean paying all adults $20,000 each. My understanding is that it means that if you earn less than $20,000 then your income will get topped up. So the actual cost to the treasury will be a lot less than your estimate of $60 billion.


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  Reply # 1686136 11-Dec-2016 18:12
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Hammerer:

 

Geektastic:

 

So if you set UBI at (say) $20,000 a year net of any taxation every million people you pay it to will cost $20 billion.

 

Let's say that 65% of the population is over 18 and therefore eligible for Basic.

 

NZ population approx 4.5 million so that makes 2.9 million or thereabouts.

 

So we need around $60 billion a year to cover that.

 

 

I'm not familiar with Gareth Morgan's UBI but I'm sure that UBI doesn't mean paying all adults $20,000 each. My understanding is that it means that if you earn less than $20,000 then your income will get topped up. So the actual cost to the treasury will be a lot less than your estimate of $60 billion.

 

 

Thats how I see it. 


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  Reply # 1686202 11-Dec-2016 20:52
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http://www.taxpayers.org.nz/money_for_all

Worth a read. Sorry can't make it a normal link on my phone.





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  Reply # 1686210 11-Dec-2016 21:15
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Hammerer:

Geektastic:


So if you set UBI at (say) $20,000 a year net of any taxation every million people you pay it to will cost $20 billion.


Let's say that 65% of the population is over 18 and therefore eligible for Basic.


NZ population approx 4.5 million so that makes 2.9 million or thereabouts.


So we need around $60 billion a year to cover that.



I'm not familiar with Gareth Morgan's UBI but I'm sure that UBI doesn't mean paying all adults $20,000 each. My understanding is that it means that if you earn less than $20,000 then your income will get topped up. So the actual cost to the treasury will be a lot less than your estimate of $60 billion.



Yes I realised that after I wrote it. :)

A heck of a lot less because you'd only be missing out on the amount paid on tax on the first 20k to anyone making over 20k, assuming you weren't charging any tax on the first 20k which doesn't have to be a given (on those making over 20k).

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  Reply # 1686211 11-Dec-2016 21:30
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Geektastic: http://www.taxpayers.org.nz/money_for_all

Worth a read. Sorry can't make it a normal link on my phone.


Good article. That's why I want to see more details on how Gareth expects this to work. Apparently Morgan's website is going to have a calculator you can see how his policy will affect you.

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  Reply # 1686246 11-Dec-2016 22:00
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I was just musing about retirees. $11k each UBI for a couple with $300k savings earning 4% untaxed is $34k per year.

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  Reply # 1686267 11-Dec-2016 22:58
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Hammerer:

 

Geektastic:

 

So if you set UBI at (say) $20,000 a year net of any taxation every million people you pay it to will cost $20 billion.

 

Let's say that 65% of the population is over 18 and therefore eligible for Basic.

 

NZ population approx 4.5 million so that makes 2.9 million or thereabouts.

 

So we need around $60 billion a year to cover that.

 

 

I'm not familiar with Gareth Morgan's UBI but I'm sure that UBI doesn't mean paying all adults $20,000 each. My understanding is that it means that if you earn less than $20,000 then your income will get topped up. So the actual cost to the treasury will be a lot less than your estimate of $60 billion.

 

 

 

 

As far as I can tell from his (not very good) websites, it is actually what I said - everyone gets $20,000 (or whatever number he thinks it should be - it did not say and I am not buying his book to find out!) and is free to add to that by work if they want to (he's not clear on the exact details - would he expect employers to immediately discount salaries by  the $20,000 (or whatever it is) for example? I can see plenty trying.)

 

He says

 

"Paying universal transfers acknowledges that every individual has the same unconditional right – to a basic income sufficient for them to live in dignity. The Unconditional Basic Income (UBI) provides this.

 

With this basic protection in place people are then free to add to that income through paid work if they choose."

 

Adding to it implies to me that they will give it to even someone on $1 million a year.

 

He also proposes a flat income tax rate of 30% which seems pretty high to me, as well as scrapping a whole raft of other benefits which may or may not include tax credits for children and so forth.

 

The biggest problem is that you have to set the amount high enough so that it actually qualifies as a basic income. $10,000 is not enough for anyone to live with the 'dignity' his website is fond of mentioning - personally I would say you'd need to set it at at least $30,000 to achieve that and I can't quite see how that would work. You'd end up having to tax everyone who chose to work a great deal more than now I suspect. It would have to be higher than the $11,000 someone mentioned above I would say.

 

 






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  Reply # 1686269 11-Dec-2016 23:08
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I can also see it driving incomes down as a perverse result of the Law of Unintended Consequences.

 

If the job before UBI was paying $80,000 I bet it suddenly pays $60,000 (based on the $UBI of $20,000 guess above) next time the post is advertised....!






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  Reply # 1686287 12-Dec-2016 06:04
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Here is a paper on the idea of UBI in NZ, worth a read: https://d3n8a8pro7vhmx.cloudfront.net/nzlabour/pages/4208/attachments/original/1461211267/Background_Paper_-_A_Universal_Basic_Income_for_New_Zealand.pdf?1461211267




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  Reply # 1686288 12-Dec-2016 06:09
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Bored rich guys really do ruin politics...


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  Reply # 1686292 12-Dec-2016 06:41
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A Bernard Hickey 2011 article on UBI here: http://www.interest.co.nz/opinion/54671/opinion-gareth-morgan-fleshes-out-his-big-kahuna-idea-comprehensive-capital-tax-and

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  Reply # 1686293 12-Dec-2016 06:54
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So reading the comment section of the Hickey article from 2011 I came across this quote

''Between 1968 and 1982, the United States federal government sponsored four negative income tax experiments. This paper provides a set of consensus estimates of the labor supply responses to these experiments. It is found that despite the wide range of treatments and evaluation methodologies, the results are remarkably consistent. On average, husbands reduced labor supply by about the equivalent of two weeks of full-time employment. Wives and single female heads reduced labor supply by about the equivalent of three weeks of full-time employment. Youth reduced labor supply by about the equivalent of four weeks of full-time employment. Estimated income and substitution effects are quite similar to those obtained from nonexperimental studies.''

from this abstract: http://www.jstor.org/stable/pdf/145685.pdf?seq=1#page_scan_tab_contents

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  Reply # 1686306 12-Dec-2016 07:51
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My general point is as a country we seen to spend about the same proportion of income on housing regardless. I would rather a higher proportion of that spend, which we will be spending anyway, went as tax rather than mortgage/rent ( soneone elses mortgage) to the banks. Similar to parts of US where houses are cheaper but property taxes are higher.

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