Taxing artificial intelligence

The development of Artificial Intelligence (AI) has become an issue of global significance. AI is now used not only in the industrial sector but nowadays also in the service and entertainment sectors. Robots can help lawyers, doctors, bankers, brokers, nurses, farmers,

social workers or even artists. Increased use indeed has positive impacts as robots can now replace difficult, repetitive or even dangerous activities (such as cleaning polluted sites) and encourage efficiencies. However, the impact in the future of human labour is a growing concern. The recent appearance of conversational and collaborative models of AI, using large language models, such as ChatGPT, has also reinforced fears of a major impact on jobs, which, under a pessimist view, could drastically shrink in favor of automation and even disappear in the long-run.

While the impact of AI on the future of jobs is highly controversial, it seems at least likely to us that many jobs will disappear. Furthermore, As a result, it is by no means certain that enough new jobs will be created to compensate for those that would have disappeared. In addition, many workers will not be able to adapt soon enough to the evolution of their profession. With jobs disappearing and inequality among labor and capital increasing, massive financial consequences would occur for the States, notably to finance social security. Indeed, taxes and social contributions on salaries are, in general, the most important source of revenues for the States. Consequently, it is necessary to explore solutions to the impact of AI on the economy, should, in the future, the pessimist scenario become reality. In our opinion, a tax on AI represents an interesting alternative that deserves to be considered.

The risks that automation raise on the future of human labor are beginning to be taken seriously.

The idea of taxing AI, or robots, is now debated all around the world. In a report on February 16, 2017, the European Parliament questioned the possibility of taxing “smart robots”, but ultimately decided against it 2. The following day, Bill Gates, in an interview with the TV Quartz channel, also confirmed his support for a taxation of robots in order to address

potential disappearance of human workers. On our side, back in early 2016, we have argued

in favor of robot taxation, leading further to a proposed taxation of AI, as a solution for the future.

The idea of taxing AI or robots raises complex issues [...]

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