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A Feasible Basic Income Scheme for GermanyImplementation of a Basic Income by a Negative Income Tax

A Feasible Basic Income Scheme for Germany: Implementation of a Basic Income by a Negative Income... [This chapter provides evidence that the concept of a negative income tax (NIT) is well suited for implementing a minimum income from an economic point of view. A NIT-scheme does not only feature a guaranteed basic income for everyone but also increases the transparency of the tax-and-transfer system. However, by accumulating most (or all) social transfers in a new tax-and-transfer scheme, transfer payments cannot be sensitive to the individual’s specific situation anymore due to the general characteristics of the income tax.The chapter begins by clarifying the overall concept of a negative income tax. It is then shown that – from an economic perspective – a NIT-scheme is similar to the original idea of an unconditional basic income. Different types of NIT-schemes such as social-dividend-type and poverty-gap-type models are discussed and compared afterwards. The chapter ends with an overview of the few empirical studies that exist with regard to negative income tax plans.] http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png

A Feasible Basic Income Scheme for GermanyImplementation of a Basic Income by a Negative Income Tax

Part of the Contributions to Economics Book Series
Sommer, Maximilian
Springer Journals — Mar 2, 2016
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22 pages

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Publisher
Springer International Publishing
Copyright
© Springer International Publishing Switzerland 2016
ISBN
978-3-319-24062-6
Pages
51 –73
DOI
10.1007/978-3-319-24064-0_3
Publisher site
See Chapter on Publisher Site

Abstract

[This chapter provides evidence that the concept of a negative income tax (NIT) is well suited for implementing a minimum income from an economic point of view. A NIT-scheme does not only feature a guaranteed basic income for everyone but also increases the transparency of the tax-and-transfer system. However, by accumulating most (or all) social transfers in a new tax-and-transfer scheme, transfer payments cannot be sensitive to the individual’s specific situation anymore due to the general characteristics of the income tax.The chapter begins by clarifying the overall concept of a negative income tax. It is then shown that – from an economic perspective – a NIT-scheme is similar to the original idea of an unconditional basic income. Different types of NIT-schemes such as social-dividend-type and poverty-gap-type models are discussed and compared afterwards. The chapter ends with an overview of the few empirical studies that exist with regard to negative income tax plans.]

Published: Mar 2, 2016

Keywords: Transfer Payment; Subsistence Level; Minimum Income; Basic Income; Subsistence Minimum

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