Universal Basic Income: A Liberal Party Proposal
April 20, 2021
A Universal Basic Income (UBI) would provide all Canadians with a certain amount of money every year regardless of their financial need, writes Peter Watson.
This is a concept that warrants our attention. At the Liberal Party convention last weekend, this idea achieved overwhelming support with a 77 per cent vote in favour.
The focus is to lift those currently below the poverty line into an area of better financial security. That could include those that have suffered financially because of the pandemic.
In my opinion, this would be a useful social safety net for the millions of Canadians that will have their earning power reduced or eliminated because of future technical advancements or new ways that business is conducted.
For example, self-driving cars and trucks will significantly reduce job opportunities. Plus, our retail habits have changed towards big box stores and home delivery.
The labour market is changing. Those changes will accelerate in the future.
Some argue that giving a basic income to everyone makes no economic sense because everyone does not need the financial assistance.
For simplicity’s sake, I would suggest it is tax-free for all. Taxing those that have medium to high income can easily be done by adjusting tax rates on income earned above the UBI amount.
Those that need to be taxed will be taxed.
The pandemic has been the most significant reset of how the Canadian economy works during our lifetime. There is an opportunity to build a better future.
In my opinion the UBI concept will be implemented. It was supported by the Liberal party but that does not mean it will be their domain.
Other parties will likely adopt the concept. It makes economic sense.
Peter Watson is registered with Aligned Capital Partners Inc. (ACPI) to provide investment advice. Investment products are provided by ACPI. ACPI is a member of the Investment Industry Regulatory Organization of Canada. The opinions expressed are those of the author and not necessarily those of ACPI. Peter Watson provides wealth management services through Watson Investments. Peter can be reached at peter@watsoninvestments.com
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