Apr 16, 2019

Experts weigh taxing robots to pay for the jobs they take

Photo: Julian Stratenschulte/dpa/Getty

Most Americans will file their income taxes by midnight tonight, and employers will report their payroll taxes later this month. But companies that have replaced or expanded their flesh-and-blood staff with robots will get a free pass.

What's new: Amid fears of automation-fueled job loss, a once-fringe debate is exploding into public view: Why don't we tax the bots?

The big picture: For over a century and a half, the United States has taxed income, first to fund war and later to build up the country's coffers. But now, some experts say it's time to reevaluate who — or what — should be taxed.

  • The idea is to use money raised from companies carrying out automation to help retrain or support people who lose their jobs because of it.
  • Among the robot levy's most ardent — and improbable — supporters is Bill Gates, who in a 2017 interview said robots should be taxed "at a similar level" to the humans it replaced, even if that slows the speed of automation.
  • Pumping the brakes will give policymakers more time to counteract potential unemployment, proponents argue.

"It's a bit like polluting the environment," says James Manyika, director of the McKinsey Global Institute. Companies will choose cheap, dirty fossil fuels over clean energy unless there are incentives not to — just like they'd likely choose to automate away jobs rather than invest in technology that complements human abilities.

Detractors, however, say a tax could stall innovation at a time when China is unwaveringly pushing to dominate AI and robotics.

  • In a report last week, the Information Technology and Innovation Foundation, a think tank, argued that the robot tax would slow GDP and wage growth.
  • ITIF president Rob Atkinson instead called for a tax credit for investing in robots, calling predictions of job loss from automation overblown.

What's next: Watch this debate head to Washington.

Go deeper: A Yale professor argues for the robot tax (The Guardian)

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