cover image: Lessons from Ontario’s Basic Income Pilot /



Lessons from Ontario’s Basic Income Pilot /

16 Oct 2019

While the OBIP was indeed in the Canadian province of Ontario, the Basic Income Pilot is actually a Negative Income Tax (NIT), not a Basic Income at least according to the Network’s definition. [...] Like the Network’s Basic Income, a Negative Income Tax would make unconditional and periodic cash payments, but it would pay households, not each individual in a household, and the household would be income tested; that is, the amount to be paid would be determined by the household’s income.3 Furthermore, if a pilot is primarily a test of the administration of a new program, and an experiment is p [...] With a 25 percent reduction rate, the same recipient would need $67,956 income before the benefit is eliminated entirely.7 The lower the reduction rate the greater the number of people with higher incomes who become eligible for a larger benefit and therefore the higher the cost of the program. [...] The higher the reduction rate, the lower the cost: the lower the reduction rate, the greater the work incentive. [...] Having multiple NIT structures would have required a larger sample size to differentiate the (presumably) small differences in the effects of each structure: the larger the sample size the higher the cost of the OBIP and the more complicated the whole experiment.
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Published in
Toronto, ON, CA

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