But then wouldn't businesses who sell a lot of goods to people on the minimum income just put their prices up to force the gov to increase the minimum income at above inflation rates every year?
You also still have the problem of people like drug addicts who spend all of their minimum income on drugs/drink/gambling and are still left homeless.
I would imagine the smartest way to implement such a thing would be to index the amount of money to a basket of goods, much like the way in which inflation is calculated.
I think the problem would be with relatively inelastic things like housing. A landlord could easily just set their rates to 70% of minimum income and as other properties would be out of reach to those on minimum income there would be little competition. At that point you would get strong pressure to increase the minimum income or implement price controls.
We have had similar problems in the UK with private landlords renting out very poor quality housing at high prices to those on welfare. In the past we solving this by building lots of social housing.
I think a more sustainable way, if you want to implement a basic income, would be to have a low flat tax (say 10%) on all types of income, than divide the tax revenue across all citizens. That way everybody will cheer on the capitalists.
You also still have the problem of people like drug addicts who spend all of their minimum income on drugs/drink/gambling and are still left homeless.