Political online game and economic simulation

This isn't really how an NIT works. First, the government selects a supplement threshold by which all households with lesser income are guaranteed income. Second, the government selects a supplement percentage that is paid as PART of the gap between the poverty line and actual income.

For example, if our household earns $6,000, our government says that $10,000 is the supplement threshold, and our government promises a 25% supplement, then we will receive $1,000.

However, the reform's description says otherwise. Say that our household earns $6,000 and our cost of living is $10,000. In that case, the government would give us more than the full $4,000, but $7,000 since only half of our income is considered.

Furthermore, cost of living is NOT automatically connected to the supplement threshold, the supplement threshold is NOT automatically connected to the poverty line, and the poverty line is NOT automatically connected to 50% of the median income level. For example, say that our household earns $6,000 but we are irresponsible and gluttonous enough to spend $20,000 for our cost of living through credit and borrowing. In that case, the government would still be obligated to provide us with $17,000 under the reform's description.

As such, in order for the NIT to be properly implemented in this game, not only does the description need to be changed, but it needs to carry a secondary figure which establishes the level of basic income. For example:

Tax level: 15% (does NOT affect beneficiaries of NIT)
Supplement percentage: 25% (does affect beneficiaries)
Supplement threshold*: $10,000 (does affect beneficiaries)

*Should have the OPTION of reflecting the poverty line

Under these settings, all citizens that make less than $10,000 will receive 25% of their differences whereas all citizens that make more than $10,000 will pay 15% in taxes.

Note that this is not a critique or defense of the NIT. Yes, there is the obvious conflict of interest at hand for those who make over the threshold and will pay taxes which result in their income being less than those who receive supplement. The purpose of this suggestion though is not to correct said policy problems (although it would certainly help if regents could have tools coded into the matrix to get around them and I'd be willing to help there as well).

well i guess there are some different versions of negative income tax. the key idea is that some people get money from the state instead of paying taxes. it is in the power of the government to decide how exactly this amount is set. i never heard about the version you describe, but i heard about the version from the refomr text.

Tbh, I've never heard of the version explained by the reform. What I have heard of are the experiments done in New Jersey and how they were administrated:

However, I have also heard of a version where a fixed government supplement is made available combined with a flat tax rate (the problem here being that all governments do not use a flat tax rate, so an alternative has to be made available). For example, if the income threshold is set at $40,000, a household with a $20,000 annual income, under my above (cited) description, would receive ($40,000-20,000)*.25 = $5,000 which makes their total income $25,000. Likewise, if we use the fixed supplement/flat tax method, the same household would pay $5,000 and then receive $10,000 which results in it again receiving $25,000 for the year ($10,000 determined by 25% of $40,000).

The problem with the reform text is that it neglects two aspects of the actual NIT. One, the NIT only reimburses a PART of the gap between actual income and the threshold. Two, the NIT is set according to a fixed threshold that applies equally for everyone who is taxed by it (which is why it improves equity), it is not (as the reform says) set to the cost of living which varies from household to household.

There are many versions of the NIT, most of which can be found on wikipedia. The one I like the best is that everyone pays the same tax rate, but then everyone is paid a certain safety net income.
Eg. tax rate for everyone is 25%, but everyone receives 10,000 from the gov't.
If you earn 10,000 then you'd owe 2,500 in taxes but then you'd get the refund of 10,000 and would get a net gain of 7,500 from taxes so your final income would be 17,500.

If you earn 40,000 then you'd owe 10,000 in taxes but the refund of 10,000 would cancel it and you wouldn't pay any tax.

Effectively it results in a progressive taxes where the incentive to earn your next dollar remains constant. As your income approaches infinite then your tax would approach 25%.

Can reforms use input data by regents? That would be a step forward.

Maybe for simplicity it would be best to use "cost of living" for the state as the default threshold, or base support by the state.