> EDIT: also, I just noticed the quintiles in your example don't even sum correctly. You're distributing $180K but only taxing $174K.

That's my mistake, typo due to overly quick math. It's too late for me to edit the comment, but the missing $6K needs to be distributed across the quintiles. This doesn't fundamentally change the math at all, and hence does not invalidate the argument at all.

> No, you'd increase the tax burden by 37% of their gross income, which is a totally different thing.

> Your proposal takes an additional $85K per year away from them. It therefore increases their taxes by 118%.

You're saying that it (a little more than) doubles their taxes. I never claimed otherwise, I meant that the percentage would increase by 37%, at most — which would in effect double their effective tax rate.

I want to do the math just to give your argument a fair shot. In FY2019, the total outlays of the US Federal government was $4.45 trillion. Per capita, that's $13,500.

Let's assume that there's literally 0 overlap between a UBI and all existing programs — extraordinarily unlikely, but I'll play your game — and we wanted to maintain an $18,000 UBI. That's essentially a $32,000 in benefits (I'm throwing in an extra $500 just to make my argument that much harder).

Let's go back to our fictional nation, where there are 10 people that are distributed exactly like they would be in the US today. We'd need $320,000 across 10 people.

Unemployed #1-5: 0

Lowest: $13,000

Second: $30,000

Third: $40,000

Fourth: $59,000

Highest: $178,000

Total revenue: $320,000 (this time I double checked!)

Now, because, in this scenario, $13,500 is not actually cash money, but is going towards existing Federal outlays, the net pocketed amount isn't actually $32,000 — it is actually $18,500.

Unemployed #1-5: $0 - $0 + $18,500 == $18,500

Lowest: $13,775 - $13,000 + $18,500 == $19,275 (effective tax -39%)

Second: $37,923 - $30,000 + $18,500 == $26,423 (effective tax 30%)

Third: $63,572 - $40,000 + $18,500 == $42,072 (effective tax 34%)

Fourth: $101,570 - $59,000 + $18,500 == $61,070 (effective tax 40%)

Highest: $233,895 - $178,000 + $18,500 == $74,395 (effective tax 68%)

These tax rates are Scandinavia-level rates. The middle class taxes are also high, but that's also true in most EU countries. These are also approaching FDR level marginal tax rates.

All that being said, these high taxes assume that there is literally 0 overlap between a UBI and over half of the existing Federal welfare expenditure — extraordinarily unlikely. This also totally ignores payroll tax revenue, which is about 35% of total revenue. And this is assuming 0 VAT, which most of the developed world has in some capacity. It also assumes that we want to continue to provide targeted welfare for a sub-section of society that is, on average, among the richest (old people). It also assumes that we want to pay equal UBI to everyone of all ages, rather than providing half the UBI per child, or some such percentage — I.e. should a family of 4 receive $74,000 per year? I think not. This is the most generous UBI. Like I said, we can play with different levels of progressivity and generosity of the system itself — but the general idea is the same.

The above math should show that a net increase in effective tax rate to 68% is the absolute worst case increase in income tax, assuming 0 overlap and 0 alternative taxation (both very unlikely), and assuming a comically generous UBI. At the very least, it should also show that it is within the realm of possibility to fund a UBI through progressive taxation.