Prince Edward Island, the smallest Canadian Province, has been described as the best choice for the pilot due to its diminutive size and clear boundaries.
According to the successful bill, every citizen will receive a basic income in an attempt to reduce or "potentially eliminate poverty in the province".
Green Party leader in Prince Edward's legislature, Peter Bevan Baker, proposed the motion with support of all three other parties.
Mr Bevan Baker told CBC: "A universal basic income could enable the greatest unleashing of human potential ever seen."
The bill stated positive effects of universal basic income include: "Local economic growth, supporting entrepreneurship, reducing administrative, complexity and costs, improving working conditions, reducing crime, improving health, and helping to build vibrant rural communities."
The Green Party leader has admitted there are potential drawbacks to UBI such as the overall the cost of the scheme and whether it will deter unemployed people looking for work.
He said: "This is exactly why we need a pilot project — so we can evaluate whether the benefits outweigh the costs."
The national Canadian government will use the pilot to weigh up the benefits against the heavy costs. The details of how the pilot will be implement have yet to be finalised.
Fife council in Scotland is currently considering a trial UBI scheme after the motion received huge backing from anti-poverty charities.
A pilot is currently running in Holland, while Finland is to launch one next year.
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