![]() ![]() ![]() While someone who makes a little money - but not enough to pay income tax - will receive less from a negative income tax than someone who doesn’t make any money, overall, the person earning more will have more. ![]() This structure is designed so that people who work will always make more than people who don’t, which would ideally incentivize people to work. (This is different from a universal basic income in which everyone, regardless of income level, receives the same amount of money.) If they made $35,000, they would receive $2,500 from the government. For instance, if the income cutoff was set at $40,000, and the negative income tax percentage was 50 percent, someone who made $20,000 would receive $10,000 from the government. Theoretically, this would work by giving people a percentage of the difference between their income and an income cutoff, or the level at which they start paying income tax. In contrast to a standard income tax, where people pay money to the government, people with low incomes would receive money back from the government. The negative income tax is a way to provide people below a certain income level with money. ![]()
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