1 There are many theoretical justifications for a basic income. For Thomas Paine and his heirs, a basic income represents fair compensation for the fact that individuals have been dispossessed of their natural right to the earth, and the ecological resources and produce that these resources freely yield (Paine 1796). For James Meade, a basic income is justified by the collective heritage of technical progress, which enables each worker to be more productive, but of which the profit has been reserved for paid employees and other owners of capital (Meade 1993). For Monnier and Vercellone, there is a need to fairly reward the cognitive share of work that plays a growing role in the production of value: basic income is justified by the fact that this cognitive work is collective and diffuse, its contributors cannot be identified, and thus they cannot be given a salary in recompense (Monnier and Vercellone 2006).

2 But beyond all the economic justifications, universal basic income is first and foremost a political and social choice. It is the choice to emancipate individuals, particularly in their role as workers, in a context where work is increasingly losing its meaning. This is demonstrated by the proliferation of so-called “bullshit jobs,” all those jobs in which the worker does not feel they are useful to the community but that they are obliged to accept in order to have an income and a social status (Graeber 2013). Basic income allows work to regain its meaning, once it is not dictated solely by the profitability that it procures for the employer, but also by the meaning that it is given by the worker.

3 This desire for autonomy in work is met by making it possible for individuals living on RSA (revenu de solidarité active, the minimum income for unemployed and low-paid workers in France) or on other unemployment benefits, to get involved in a business opportunity, a cultural project, or a citizenship project. We therefore need to leave behind the discourse of the fight against poverty associated with minimum social benefits, with all the paternalist dimension that comes with it: “the poor make no effort to find a job,” etc. Instead, we need to enter the discourse of emancipation that belongs to basic income. Unlike RSA, which is given to the “poor because they have no jobs,” basic income is paid to everyone so that they are able to exercise their right to choose a job in line with their goals, and their right to be well paid if they do a job that is difficult, mundane, or with no degree of independence.

4 Basic income does not of course do away with the need to support people who have difficulties entering the workplace. But while support is necessary, checking up on those who receive minimum social benefits is counter-productive. It would also be wrong to think that only people with difficulties entering the workplace need support. A further advantage of basic income is that it enables us to move away from a division of society by categories of “workers” and “people on welfare” at both the level of the institutional treatment of individuals, and the political exploitation of the discourse that consists of setting these two categories in opposition.

5 Finally, basic income is becoming an urgent need in view of the powerful trend of job automation and digitalization, which could threaten up to 50 percent of existing jobs between now and 2050 (Frey and Osborne 2013). Basic income should not be misunderstood. It is in no way justified by the disappearance of jobs, because it cannot be reduced to an income for mitigating the growth of unemployment. The creation of jobs is in any case still possible, as Sauvy’s “spillage” theory reminds us (Sauvy, 1980).

6 But let us remind ourselves that creating jobs is not an objective in itself. Without a basic income, workers whose jobs are replaced by machines or computers risk being forced to accept any job to live, including a “bullshit job,” a job whose social utility has yet to be demonstrated. With a basic income, on the other hand, workers would have greater freedom to choose a job with meaning, whether or not it is remunerated. Even if there were full employment, basic income would still be necessary, because it would guarantee that no-one does their job solely through obligation.

7 And if basic income is not in absolute contradiction to employment, it enables us to move beyond that political stalemate in which we choose to protect economic activities that have damaging ecological, health, and social consequences, in the name of the jobs that these activities create. We are at the point of nearly sacrificing the fight against climate change in the name of defending employment. With a basic income and other forms of effective welfare protection—unemployment benefits, rights to training, perhaps even a professional welfare allowance as proposed for example by Gazier (Gazier 2005)—political decision-makers will be more disposed to implement environmental and health measures without having to worry about their consequences on existing jobs.

The Ideal Basic Income

8 Ideally, basic income would be “at the highest level that can be supported” (Van Parijs 1996). Its funding should draw heavily on all income that is associated with economic rents rather than with work. There should for example be higher taxation on the profits of the Internet giants (Facebook, Google, Amazon, Uber, Airbnb, etc.), who have huge earnings thanks to their positions of “natural” monopoly. As proposed by Thomas Piketty, there should also be higher taxation on inherited wealth, particularly on inherited real estate and land, which bring their owners huge profits in densely-populated areas and whose under-taxation exacerbates speculative bubbles (Piketty 2014). Inherited (agrarian) land was also the primary driver of inequality in the time of Thomas Paine, who proposed taxing it through a 20 percent inheritance tax and redistributing the profits to all in the form of an allowance at the age of majority and a retirement pension. We could also fund basic income by reforming monetary creation, beginning for example by giving the money newly created by the ECB (European Central Bank) for its “quantitative easing” directly to individuals, rather than using it to purchase banks’ debt securities.

9 However, the improved taxation of web multinationals and inherited wealth, and the reform of monetary creation, although needed to achieve a basic income at a level approaching the poverty threshold, appear difficult to achieve in the short term. Multinationals currently generally pay much less tax on their earnings than small and medium enterprises. [1] To minimize their taxes, they know how to play off the countries that might receive their investments against one another in order to obtain tax benefits, as demonstrated notably by the LuxLeaks scandal, which is certainly far from being an isolated case. They also have at their disposal all the tools of tax optimization, the abuse of exemptions such as research tax credit or the manipulation of transfer prices in order to declare their earnings in countries with low tax rates.

10 Therefore, if we want to improve the taxation of multinationals, we need to have better tax coordination between countries, get rid of tax havens, and implement a corporate tax at the European level. This same absence of tax coordination between countries also prevents the implementation of a truly effective inheritance tax. As for the reform of monetary creation, this is a long-running political battle.

11 Although it is difficult to remove in the short-term the obstacles—above all geopolitical—that prevent us from implementing a universal basic income at a “high” level, we must begin by implementing a basic income, even if it is at a level equivalent to current RSA. And this should be done immediately. We could then look to increase the level of basic income as we achieve better taxation of multinationals and household wealth.

Implementing a Universal Basic Income Now

12 The short-term proposal consists of implementing a basic income at the level of existing RSA for a single individual (€524 per month in 2016) from the age of 18. This basic income would not replace RSA or the new prime d'activité (employment allowance) that was implemented in January 2016. Housing benefits would be kept as they are. Basic income would not of course replace either the unemployment insurance system, nor the retirement system. It could potentially be deducted from their amounts, as it would be deducted from disabled adult allowance or the minimum old-age pension.

13 This basic income would be funded by income tax, deducted at source from the first euro earned, the rate on the first bracket varying between 23 percent and 30 percent depending on the tax base and parameters used. In time, better taxation of multinational earnings and household wealth could take over from income tax or supplement it. However, funding basic income solely through income tax in the first instance means we do not have to wait for tax coordination between countries to progress in order to implement the measure.

14 The reform enabling this basic income to be implemented could be carried out in one go, through a single law, or stage by stage, through a succession of reforms of the RSA: the automation of the RSA, the individualization of the RSA, and the universalization of the RSA, in order to arrive at a universal basic income. I will explain the process in stages for instructive purposes, since this not only enables the demystification of basic income, but also highlights the numerous advantages offered by the reform of basic income, notably with regard to the current system of RSA and income tax.

15 The first stage is the automation of RSA payments and the new prime d'activité, [2] so that all individuals currently eligible to receive RSA do so automatically, without even needing to apply. This would go in tandem with abolishing both the obligation to look for a job in order to receive RSA, and the principle of subsidiarity that obliges the recipient to ask for family assistance before applying for RSA. This would put an end to non-use. [3]

16 The Sirugue Report on the reform of minimum social benefits presented to the prime minister in April 2016 proposed moving toward automation by making it much easier to apply for RSA, but its recommendations did not go as far as abolishing the application process and the obligation to look for a job (Sirugue 2016).

17 The second stage consists of individualizing RSA. Individualization may be either partial, or total. Partial individualization would mean that a couple with no income would not receive couple’s RSA, which is paid to the “head of the family,” and equal to 1.5 times RSA for a single individual, but that each half of the couple would receive their basic income. The total individualization of RSA would mean that an individual with no income with a partner who is able to provide for their needs would still receive RSA, without taking the income of their partner into account. This would ensure the true independence of each partner, which is vital when it comes to breaking away from a violent husband, for example.

18 The existing welfare tax system effectively perpetuates relationships of dependence within couples. In couples with unequal incomes, the individual with the income benefits from a reduction in tax if his/her partner has a low or no income, following the “marital quotient” principle. This is supposed to ensure the livelihood of the partner. The reform would give the partner without an income the right to receive RSA while the tax advantage procured by the partner with an income through the marital quotient principle would be reduced, if not entirely abolished. But this requires a reform of income tax.

19 Once an RSA that is automatically paid to those with a right to receive it is achieved—even if incompletely—RSA would merely need to be made universal in order to achieve a universal basic income. This universalization of RSA would be financed by an income tax, levied on the first euro earned at a level between 23 percent and 30 percent—according to the tax base used—on the very first bracket and progressing from an upper threshold.

Would a Basic Income Cost Too Much?

20 Although in fact fairly simple, the progression from an RSA to a universal basic income is very difficult for many to envision, on the grounds of the colossal budget they believe it would require. The measure would in effect increase public expenditure by 179 billion euros, or 8.4 percent of GDP. [4]

21 Such figures might lead the wealthiest households to radically oppose the implementation of a universal basic income through the fear of losing out from the reform. If we hope to increase the taxation of the wealthiest households, we must recognize their ability to mobilize politically in opposition.

Gross and Net Budget of a Basic Income of €465 in 2013^{(1),(2),(3),(4),(5)}

Adult population	52 million
Number of which are receiving a retirement pension(1)	-13.8 million
Number of which are on unemployment benefit(2)	-2.5 million
Number of which are receiving an adult disability allowance(3)	-1 million
Number of adults who “do not yet receive” their basic income (A)	34.6 million
Monthly total of universal income	€465
Annual total of universal income (B)	€5,580
Gross budget (C = A x B)	193 billion
RSA (excluding child supplement)(4)	10.0 billion
Employment bonus	2.5 billion
Student bursaries(5)	1.9 billion
Total amount of welfare policies replaced by the basic income (D)	14.4 billion
Net budget of basic income (E = C – D)	178.9 billion

Gross and Net Budget of a Basic Income of €465 in 2013^{(1),(2),(3),(4),(5)}

(1) Source: CNAV
www.statistiques-recherches.cnav.fr/chiffres-cles.html
(2) Source: UNEDIC
www.unedic.org/publication/les-chiffres-qui-comptent
(3) Source: CAF
http://data.caf.fr/dataset/personnes-percevant-l-allocation-aux-adultes-handicapes-aah-par-caf/resource/7a870488-f0de-4a40-9d8f-52e065e43c10
(4) Source: CAF
http://data.caf.fr/dataset/les-depenses-tous-regimes-de-prestations-familiales-et-sociales/resource/64f6f137-4a74-4ab9-abd2-82f64c44eee4
(5) Source:
French Senate www.senat.fr/commission/fin/pjlf2014/np/np21/np214.html

22 In order to prevent the progression to basic income failing due to the political mobilization of the wealthiest individuals, it may be preferable to implement basic income without reducing—or otherwise reducing only moderately—their disposable income. This would not preclude increasing taxes on high earnings or inherited wealth at a later date, but such an increase would be independent of the question of basic income.

23 It is in fact possible to achieve a basic income by slightly, or even not at all, modifying current redistribution, depending on the chosen taxation parameters. This can be understood by comparing the mechanism of redistribution with a basic income with the redistribution currently operated by the RSA and income tax. A single individual with no income can currently expect to receive approximately €465 of RSA. [5] With each additional euro earned, the RSA for this individual is reduced by €0.38. Once he/she is earning SMIC (salaire minimum interprofessionnel de croissance, the minimum wage in France), this individual has no right to receive RSA and begins to pay income tax. [6] What would happen for the same person with basic income? An individual with no income would receive basic income instead of RSA. With each increase in his/her income from employment, basic income would not reduce, but income tax would be charged. If we do not wish to change the current redistribution, we could maintain a very first bracket at 38 percent, but we would then have a regressive system of taxation since the next bracket is imposed at the rate of 14 percent. It would therefore make sense to create a tax with a large first bracket levied at a rate between 32 percent and 30 percent (depending on the tax base chosen) and with more enforced upper brackets. This would increase the disposable income of low income workers.

24 The reform would of course be accompanied by a deduction of tax at source. Indeed, the existence of a large first bracket beginning from the first euro earned and levied at a unique rate (between 23 percent and 30 percent) would greatly facilitate deduction at source, since the risk of calculation error and end of year recall is increased by having multiple brackets. By putting in place a very large first bracket—with upper brackets enabling this tax to be progressive—we would greatly reduce the risk of error in deduction at source and the number of accruals at the end of the fiscal year.

25 The supposedly excessive gross budget required for a basic income is therefore of no importance, since only the redistributive and motivational effects (effects on the behavior of economic agents) matter. Some individuals, such as Basquiat and Koenig, have suggested that basic income take the form of a tax credit (Basquiat and Koenig 2014). This would achieve comparable redistributive effects, [7] but would not lead to a large increase in public expenditure in the national accounts, since tax credits are not recorded in the accounts as a deduction or an expense. But this does nothing to change the fact that reporting or not reporting a large increase in public expenditure has absolutely no economic consequences, with equivalent redistributive effects.

26 Beyond the issue of the budget as shown in the national accounts, we might ask whether it is wise to merge tax deductions and basic income payments, with the latter essentially taking the form of a tax credit on the former. Income tax deducted at source is directly paid by the employer to the tax authorities—at least for salaried workers. Basic income, on the other hand, is paid directly to individuals. Merging these two transactions, which involve three different actors (the state, the employer, and the individual), would risk increasing the chance of errors and of mismatches between the net income actually received (or paid) by the individual and his/her situation, and therefore perpetuating the uncertainty that currently affects many recipients of RSA with variable incomes (Boget 2013). Paying basic income to the individual at the beginning of each month, and deducting income tax at source at the end of each month would on the other hand greatly reduce this uncertainty. It is thus preferable to separate tax deductions from basic income payments, and therefore to exclude the route to basic income as a tax credit.

How Should Tax Be Reformed?

27 It is certainly possible to finance basic income through a new specific income tax that would be added to the current income tax (IRPP, impôt sur le revenu) and social security tax (CSG, contribution sociale généralisée), deducted from the first euro earned and capped at the level of basic income levied, the threshold from which the additional net transfer is void. But it would be preferable to take advantage of the introduction of basic income by carrying out large-scale tax reform and merging the IRPP and the CSG. This would involve merging the CSG, a proportional tax without exemptions, with the IRPP, a tax that is progressive, takes into account family circumstances, and has associated exemptions. The new tax resulting from the merger between the IRPP and CSG and levied from the first euro earned must be progressive, but should it be set at the level of the individual or take into account marital status? [8] And should we maintain tax exemptions?

28 The total individualization of income tax would lead to a very large increase in income tax for very wealthy households with very unequal incomes (where one partner earns most of the income). [9] It might be considered fair to increase taxation on those very wealthy households that take full advantage of the marital quotient, but there is also the risk of such households mobilizing politically and managing to scupper the basic income project, or accepting it only at the price of a reduction in the progressivity of the tax.

29 If we believe that the marital quotient is the guarantor of progressive taxation, it may be preferable to maintain a marital quotient, or otherwise consider the couple as a whole in tax reporting. Individual basic income and taxation at the level of the couple are compatible if basic income is included in taxable income (Cauneau et al 2016), which would make it a primary income (Monnier and Vercellone 2006).

30 As for income tax “niches” or exemptions, in 2015 they represented a shortfall for the state of 34 billion euros. [10] It would be possible to maintain them in a new income tax, by adjusting the way in which they are calculated so that they continue to total the same amount. It should be noted that more modest income households would then benefit from tax exemptions, while at the moment they do not pay IRPP, so do not benefit, or barely benefit, from such exemptions.

31 We could also review tax exemptions, discard those that seem superfluous, and replace others with direct subsidies. We should not forget that some exemptions play a welfare protection role and benefit middle income households, such as the reduction for childcare costs or for the care of dependent persons (Zemmour 2013). These tax expenses could either be maintained, or shifted toward other forms of public subsidy. We could for example replace them with universal vouchers that can be used to pay childcare costs or fees for extracurricular activities, and vouchers for the care of older or dependent adults. This form of subsidy would give equal rights to all individuals, unlike current tax exemptions, which tend to be anti-distributive (Cauneau et al 2016).

Diversifying Sources of Finance or Increasing the Amount?

32 Implementation of all these reforms would leave us with a universal basic income at the level of current RSA, funded solely through income tax. But this is not necessarily the end goal. Once this stage has been reached, it will be possible to diversify funding sources by improving taxation on the earnings of multinationals and/or increasing taxes on household wealth. The increase in tax receipts could then serve either to increase the basic income amount, or to reduce the marginal rate of taxation on the first euro earned. The first option would increase the disposable income of individuals with no income, while the second would increase that of low income workers, particularly part-time workers. It might even encourage workers to reduce their amount of paid work, and thus favor a better distribution of existing jobs.

33 But before arriving at this stage, the priority remains to launch the implementation of a universal basic income, even if it is only at a modest level to begin with.