Implementing a universal basic income system, through which each person living in the country receives an estimated benefit of ¢300,000 a month, would cost the State approximately 4.22% of the Gross Domestic Product (GDP), equivalent to 1.5 billion, according to the research "Universal Basic Income in Costa Rica: Initial notes for its modeling".
UNIVERSIDAD spoke with its author, the researcher from the Center for Research in Culture and Development (CICDE) of the State Distance University (UNED) Andrei Badilla and with José Rafael Quesada, representative of the Network for Universal Basic Income of Costa Rica, who will participate on Friday in a forum on this topic.
The Universal Basic Income (UBI) proposes that the State make monthly transfers of money to each person in the country for an amount that constitutes enough money to be above the poverty line.
In his research, Badilla outlines the characteristics of UBI, its possible benefits, and a model of the estimated cost of the total benefit for a population of 5 million people.
“If we compare it with other indicators such as the fiscal deficit, tax expenditure or tax fraud exemptions, we realize that it is much cheaper to provide the population with a universal basic income than to sustain the current conditions of tax fraud, which is about 8%”, said Badilla.
What is it and how would it be financed?
Quesada explained that the UBI "is an allocation that the State would make to each person, to the entire population, regardless of their social class, the sector where they live, whether they have a job or not, whether they are an older adult or not."
“It is a minimum income. It's unconditional because you don't tell people 'this is while you get a job'. Even the richest person in the country is also assigned,” said Quesada.
Quesada pointed out that with the advances in robotics and technology, many jobs have disappeared and are not being recovered. “For example, in supermarkets where there are now 5 or 6 checkouts that are robots or in parking lots. And automation is going to follow,” he stated.
According to Badilla, there are multiple forms of financing that have been proposed. One is through high progressive taxes for privileged sectors of the Costa Rican population, such as the 5th quintile or the 10th decile.
Another is through a tax on the automation of robots, automated systems or artificial intelligence. "Why? Because these instruments are largely responsible for job destruction. And given that jobs are being automated and job creation is not growing at the same speed as automation, this could be a way to finance universal basic income,” Badilla agreed.
Another possible financing could be a tax on financial or capital transactions through a progressive and staggered rate, the researcher mentioned.
On the other hand, Quesada declared that "an institutional reform is needed that allows taxes to be collected well and then with less bureaucracy to allocate basic income" and that the origin of the resources could be the taxes that already exist.
Quesada also clarified that the UBI is different from the programs for allocation of resources for poor and unemployed families.
“These allocations change with the governments and they have fewer and fewer funds. And what happens to poor people when the funds run out? He is still poor, he still doesn't eat and the children don't have access to medicine. Universal basic income is a solution and would end poverty in Costa Rica. If you are out of work, and you have a family of 10 people and you assign a basic income to each person, people have enough to buy food, to buy clothes with,” said Quesada.
Experimental research required
Badilla clarified that in the country there is no experimental research that allows them to determine which source of financing is best suited to the social, political, financial and fiscal conditions of the country and that this is one of the main challenges.
“We should learn from the current experience of the two most important cases worldwide, which is the next one in Catalonia and the case of the initiative in Germany, where it has been proposed to give 1,200 euros per month and it has been mostly through resources from the sector. private," said Badilla.
On Friday, January 28 at 2 pm. The forum "Universal Basic Income: The new frontier in human rights" will be held, organized by the Center for Research in Culture and Development (CICDE of the Distance State University (UNED) and the Universal Basic Income Network of Costa Rica.
José Rafael Quesada, Andrej Badilla, Sergi Raventós, director of the Office of the Pilot Plan to Implement Universal Basic Income in Catalonia, and Daniel Raventós, president of the Basic Income Network in Spain, economist and professor at the University of Barcelona, will participate. The forum will be moderated by the CICDE researcher Eva Carazo.
It will be broadcast on the YouTube channel "Video communication UNED CR Room D" () and on the CICDE Facebook page.
