I don't think there is a widespread agreement amongst proponents on how things are to be funded. Some want it to be revenue natural, others a wealth tax, others VAT, others via printing money, others a mix.
I'm not sure UBI is the right way to go. But if we are to do it, my own current thinking that you start by trying to keep it neutral in the tax code (so most families get increased taxes that claw back the majority of the UBI value)
But then we need need to account for additional funds needed beyond that:
- Those currently earning less than would be clawed back (net-recipients of UBI)
- Those who we would expect to become net-recipients, that would also cut back on their current earnings.
The latter group, I'd expect to be smaller than some suspect, but still big enough that it needs to taken into account.
So how much extra are we talking about?
Back of the envelope math starting from:
https://dqydj.com/average-median-top-household-income-percen...
127,679,100 households in the US, in 2018
If we take the approach that this acts as an income floor (the clawbacks per above), and we set that floor at $40k.
We can see that 33% make less than that from the data. For laziness sake, I'll assume a linear transition from 0% to 33%. That would imply $20k/year at 16%, which is roughly what the data shows. So we can assume an average of 20k UBI for 33% of households as the net benefit.
127,679,100 * $20000 * 0.33 = $843B
Then we need to take into account those that stop earning. So let's round it up to a trillion. Note household income already take into account existing transfers like social security and unemployment benefits so we can't subtract those out as savings.
The US is wealthy enough to raise taxes by a trillion/year. It is something like 5% GDP. But that is a massive increase. It doesn't come for free with "neutral" taxation. On the other hand, we could have a lower floor, but then I don't think we actually get the benefits.