Designing A Basic Income Guarantee For Canada

Robin Boadway, Katherine Cuff and Kourtney Koebel

No 1371, Working Paper from Economics Department, Queen's University

Abstract: We propose mechanism for implementing a two-stage harmonized Basic Income Guarantee with federal and provincial components. In Stage One, the federal government replaces its refundable and nonrefundable tax credits with an income-tested basic income delivered through the income tax system. The reform is revenue-neutral. In Stage Two, each province decides whether to implement a provincial basic income guarantee that is harmonized with the federal one but allows province-specific basic income levels. The provincial basic income replaces provincial refundable and nonrefundable tax credits as well as welfare and disability transfers, and is also revenue-neutral. All social services and contributory social insurance programs remain intact. An illustrative calculation using Statistical CanadaÂ’s SPSD/M model shows the financial feasibility of a national BIG of $20,000 per adult adjusted for family size with a benefit reduction rate of 30%.

Keywords: fiscal federalism; basic income guarantee; inequality (search for similar items in EconPapers)
JEL-codes: H2 H7 I3 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2016-12
New Economics Papers: this item is included in nep-pbe
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Persistent link: https://EconPapers.repec.org/RePEc:qed:wpaper:1371

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