Taxing Robots


In this recent Article, Futurist Rohit Talwar explores the issue of robot taxes and long term unemployment. Although long, I recommend reading the entire article, but I captured some key points from the article below. This video provides a point of view from Bill Gates.

What’s driving the debate?

The big issue here is the likely extent to which automation will reshape the industrial landscape, change the nature of work as we know it and drive up the number of people facing permanent unemployment.

So why act now?

What we do know is that jobs are already going, more will follow and it would be a reckless government that didn’t think about how to address the challenges.

We already know that to compete in the emerging global economy, we need to change the nature and focus of education at all levels and prepare adults for roles in the new sectors – which will mainly be higher skilled as the “bots” will most likely do the rest. So, it’s reasonable to at least explore the scenario of rising technological unemployment over the next decade.

What would robot taxes pay for?

Clearly, the primary purpose should be to address the societal consequences of job automation. So, the most obvious application would be to fund unemployment benefits or guaranteed incomes and services.

Alongside unemployment costs, there is a strong argument that a significant proportion of the revenue from robot taxes should be channeled directly into public education. This would create a positive role for robots in society, which would be to pay for public schools and universities.

Who might lead the way and when might it happen?

By 2030 the possible pace of change means these taxes could well be commonplace in many industrial nations. Countries that are embracing automation and the digital era in all its forms such as South Korea, Japan and Singapore might be among the first to implement some form of automation taxation mechanism. China is saying little right now, but it has the capacity to enact policy rapidly should the need arise.

Whilst many in Silicon Valley argue in favor of robot taxes, the US is likely to face strong resistance to such changes. Indeed, it could well be among the last to go down this route and might conceivably not do so at all without a fundamental change in its governance and electoral systems.

What potential risks and drawbacks are there?

It is already being cast as unbridled socialism, communism or Marxism by many proponents of low taxes and free markets. However, at present, no viable alternatives are being put on the table.

What are the potential benefits?

A solution will be required if unemployment does rise and therefore government revenues decline. Whilst robot taxes may not be the ultimate answer, it is the only clear policy idea that is even being mooted today for what is an increasingly pressing societal issue.

How do we get started?

The first stage must be to run some serious computer simulations of different scenarios for the pace of automation and the impacts on employment in different countries around the world. These could be used as input to the development of economic models to explore the funding requirements of different public service strategies and how they might be met. If there’s a shortfall between what’s required and what could be collected under the current taxation regime, then the potential for different robot tax models (and any alternatives) could be evaluated and the likely implications assessed.

One thought on “Taxing Robots

  1. For me, futuristic speculation fails to the degree it doesn’t address the underlying mechanism driving all these emerging trends, the knowledge explosion itself.

    Ok, taxing robots might be a good solution to a particular set of problems generated by a particular collection of automation technologies. I don’t have a better plan, so I won’t argue. But it may not matter.

    What matters is the rate at which the knowledge explosion assembly line is delivering new opportunities and challenges. At one pace we can probably keep up and manage the output. At some higher pace we will lose control. If we lose control of the knowledge/power assembly line as a whole, it won’t really matter whether we have solved this or that particular problem.

    We could think of the knowledge explosion assembly line as a machine which is probing, looking for the single point of failure. The faster the machine runs, the sooner it will find what it is looking for. Should we tax robots? Or should we maybe take a break from building robots while we think all of through?

    It all boils down to our relationship with knowledge. The “more is better” paradigm inevitably implies an assembly line that runs faster and faster and faster until finally the machine overheats and blows up.

    Liked by 1 person

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