Negative income tax (NIT) solves this. At this point, when anyone says UBI, I just substitute NIT in my head. It is really the only practical implementation of a UBI scheme.
Further, if a UBI-like program is funded with new taxes (or cuts to existing programs), it should have a negligible impact on inflation. It is only when you do deficit spending that you risk inflation.
Good points. I think NIT would cause some inflation though as the cost for some things is related to the geography so kind of like what we saw with the pandemic some people would change location so they could afford a better lifestyle and end up driving up the prices of things in other locations. But maybe then they could base the amount on wherever someone is a resident however I’m sure this would be gamed. Maybe a state issued debit card for NIT could solve this though or banks could be required to pass transaction details to government. This could possibly assist government in information gathering for tax compliance.
I think a major feature of a UBI/NIT would be to make it entirely location independent. There are tons of areas in our country that are economically depressed, largely due to a lack of jobs. These areas typically have low cost of living, so someone on UBI would be able to live a lot more comfortably there than they would in a high cost job center.
And this in turn would provide some monetary inflows into those areas that could help revitalize them. A lot of these areas are occupied by seniors living off of social security. An influx of younger folks with UBI checks would help balance things a bit better.
