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Bill Gates, other experts propose taxing robots to pay for the jobs they took

By Axios Future

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 sRead full story

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  • What’s a robot? Is it software? A process? Where do we draw a line etc. So much of job elimination is from tech driven automation of all sorts but also just process changes as business seem efficiencies.

  • James Cakmak
    James CakmakEntrepreneur | Tech Analyst

    Rather than focusing on the areas which can help open new doors for displaced employees with the rise in automation - like investing in education - this is yet another stop-gap style solution. Taxing robots doesn’t solve the problem, it only pushes the can down the road. Were Henry Ford’s assembly line machines taxed? Or Netflix’s recommendation algorithms? Or how about Nespresso machines because they displace baristas. Technology will always move forward. Invest in people to ensure they move up

    Rather than focusing on the areas which can help open new doors for displaced employees with the rise in automation - like investing in education - this is yet another stop-gap style solution. Taxing robots doesn’t solve the problem, it only pushes the can down the road. Were Henry Ford’s assembly line machines taxed? Or Netflix’s recommendation algorithms? Or how about Nespresso machines because they displace baristas. Technology will always move forward. Invest in people to ensure they move up the skills curve. The government can create the incentives to do so.

  • Luis D Contreras
    Luis D ContrerasManager at Strategy&

    This is such a complex issue as taxes are defined by country-specific policies whereas the race for automation is borderless and among businesses and governments alike.

    If a country decides to tax automation it will most probably stifle innovation within its borders, which defeats the purpose for economic growth and protecting people's jobs anyway.

    #automation #robots

  • Kristen E. Strubberg
    Kristen E. Strubberg Founder, Editor-in-Chief at TGNR

    As satisfying as it seems on the surface, taxing companies who replace jobs with robots/automation is a nonstarter. Investing the funds from “robot tax” to help workers put out of the job by said robots, as suggested in the article, doesn’t fix the problem of needing new jobs for the displaced employees. Moreover, how would they - could they? - determine a taxable gradient for the extremely varied types of automation used by today’s businesses? Who wouldn’t hate being taxed for automation just because they use an electronic postage meter...

  • Maggie Chan Jones
    Maggie Chan JonesproFounder & CEO at Tenshey, Inc.

    There are significant costs required to re-skill workers whose jobs are replaced by automation. It makes sense for companies who reap the benefits of productivity gains to pay for the transition.

  • There will be two things robots can count on: obsolescence and taxes.

  • Mike Osswald
    Mike OsswaldVP, Experience Innovation at Hanson Inc.

    Of course this isn’t without controversy, but one way to look at it is that companies who automate aren’t exactly looking to retrain their workforce, so taxation moves the money to people who might help the displaced workers.

  • Weiyee IN
    Weiyee INChief Strategy Officer

    Back in February 2017 the EU rejected a robot tax. If the United States imposes a robot tax, but the EU does not, given their strategy towards creating national corporate champions (Deutsche Bank & Commerz Bank merger) and with China's strategy clearly being on robotics, automation and artificial intelligence, how much of a competitive disadvantage would this put the United States?

    A practical level how do the entities for taxation, robotics, count and at what levels? Will all of the robots in factories

    Back in February 2017 the EU rejected a robot tax. If the United States imposes a robot tax, but the EU does not, given their strategy towards creating national corporate champions (Deutsche Bank & Commerz Bank merger) and with China's strategy clearly being on robotics, automation and artificial intelligence, how much of a competitive disadvantage would this put the United States?

    A practical level how do the entities for taxation, robotics, count and at what levels? Will all of the robots in factories across the United States be taxed? Or only the ones that are replacing current existing jobs? Or do we include the ones that replaced previous jobs decades ago? How about the ones that are replacing potential jobs in the future? Do we tax drones that deliver goods? Do we assess higher taxes on functions that humans charge a premium for, but robots can do regardless of environmental or sociological requirements? There are even deeper and greater challenges once we consider 5G and edge computing, if we define robots as stand-alone autonomous devices or do we need to find them by levels of processing, or functionality? The practical issues can go as deep as whether or not they should be a tax on cloud-based services or artificial intelligence and deep learning.

    The fundamental issue that needs to be addressed and should have been addressed ages ago when first brought up under the Bush administration (Sr) on the potential displacement by automation in oilfield workers is training and up skill of the populace. It was the fundamental theme of his campaign, and it amounted to nothing in the last two decades since he identified the issues that are now plaguing our politicians.

    The tragic issue today is that two decades later it is far too late for us to address the problem with enough alacrity that we do not cause other socio-economic issues. Everything from the distribution of wealth from taxes to breaking up technology companies does very little to address a growing disenfranchised and atrophied class of society.

  • David Yakobovitch
    David YakobovitchAI Professor at Galvanize

    Tax the robots for their efficiency? Or make it a soda tax, or a percentage of their revenue helps retrain and reskill the future workforce of today?

  • Kalesh Menon
    Kalesh MenonFinance Controller at Ingredion Thailand

    Very interesting. If robots or automation is taxed, will the government be able to create opportunities for those displaced? Are we saying the government is not able to help them now only because they do not have the monetary resources? 🤔

    There can be other ways to support those displaced to the find another opportunity, right? Say, build a corpus ensuring minimum pay and build it into cost of automation eg support for 2-3 years for those being displaced. The business can plan these costs early

    Very interesting. If robots or automation is taxed, will the government be able to create opportunities for those displaced? Are we saying the government is not able to help them now only because they do not have the monetary resources? 🤔

    There can be other ways to support those displaced to the find another opportunity, right? Say, build a corpus ensuring minimum pay and build it into cost of automation eg support for 2-3 years for those being displaced. The business can plan these costs early and still will see long term benefits from automation and the displaced will have some support. Business can also provide them participation in profits so that they also enjoy the benefits from automation and the business they served before being displaced. There could be many innovative ways to be more humane. I'm sure this may already be prevalent in the industry. My point is that mere taxing robots will not create new opportunities. They are already around, the people need to be supported till they can be resettled.

    Rather than saying tax robots, there could be introduced a new regulation for adaptation of automation and doing business in the new environment.

    The purpose of this proposal is right-minded, how this is executed will decide how much it impacts the pace of innovation, If this is excuted that is. 👍

  • Greg Vetter
    Greg VetterCEO at Tessemae’s

    You can’t raise the minimum wage to $15/hr and tax machines that replace human labor. Bill gates is apparently very smart with computers but knows nothing about running a manufacturing business with “line workers”. His workers used to be coders and other high paying tech workers. Gates “thinks” we should tax machines like people because he is probably reading books on global economic theory which then COULD be a short term solution to slow down the implementation of machines for people. But what

    You can’t raise the minimum wage to $15/hr and tax machines that replace human labor. Bill gates is apparently very smart with computers but knows nothing about running a manufacturing business with “line workers”. His workers used to be coders and other high paying tech workers. Gates “thinks” we should tax machines like people because he is probably reading books on global economic theory which then COULD be a short term solution to slow down the implementation of machines for people. But what about the actual manufacturing businesses that are trying to grow and scale? Will that help them or the products they make? No, it won’t. Everyone floods to amazon for the cheapest price on everything they individually buy but then complains about minimum wage and robots taking jobs. Labor is an input. People will only pay so much for goods and services until they can’t. Taxing machines like people to slow down the inevitable, instead of training people to learn and manage new aspects of work is foolish.

  • Paul O'Brien
    Paul O'BrienCEO at MediaTech Ventures

    I try not to label but I think I'm fairly free market capitalist and leaning libertarian. I say that because at my core, and in a quick reaction to this, I'd oppose the idea. But it's those quick and uninformed reactions that are causing divisiveness (and worse), in the U.S. I'm also pretty open minded and love a *good* discussion of contentious issues BECAUSE informed communication is the only way to education and make the best decisions as a society. Long way of saying... Hear me out:

    I think

    I try not to label but I think I'm fairly free market capitalist and leaning libertarian. I say that because at my core, and in a quick reaction to this, I'd oppose the idea. But it's those quick and uninformed reactions that are causing divisiveness (and worse), in the U.S. I'm also pretty open minded and love a *good* discussion of contentious issues BECAUSE informed communication is the only way to education and make the best decisions as a society. Long way of saying... Hear me out:

    I think this makes sense.

    Whether Conservative or Progressive in your political views, you have to concur that government costs money. Lots of it (too make if you ask me). Welfare costs money. And unless we're going to abolish that (Social Security and Medicare come to mind), we have to pay for it somehow.

    We're in an interesting economic era wherein the middle class is disappearing, lower income classes are being replaced by machines, and those with wealth are preserving more of it. We're also in an era where we're realizing we really don't need everyone working. Whether you feel strongly about Universal Basic Income OR you believe we should all have to toil away to survive, your extreme views are ignorant if you don't at least see and agree that we just don't need everyone working. So what do we do with all the people who can't because we don't need them so??

    Something has to change.

    Today, employers pay taxes on employees. Those taxes are critical.

    Eliminating the taxes is a contentious idea. Raising such taxes is just as debated and questionable.

    But either way, we're simply replacing the person. And with the elimination of the employee goes not just the loss of a job but a loss of that tax that funds the welfare of the people.

    It's pointed out that when a society raises corporate taxes or increases minimum wage, the company just moves or dodges those rates. But without a person at all, there is a tax rate at which the employer would still be saving money by using a robot instead of a person. There is a rate at which said company wouldn't move to avoid that robot tax, because proximity to suppliers and distribution dictates that the company be where they are. There is merit to automation being taxed as our means of funding what it takes when fewer workers are needed.

  • What a great idea! Tax innovation to stifle and discourage it. A wonderful way to push a society down the civilization rankings. Of course taxation and penalization are the progressives’ standard method of dealing with most issues, rather than innovating.

  • Sean Minuti
    Sean MinutiSoftware Architect

    I think we already said this was a good idea, to get revenue for worker re-training, recycling, hw/sw maintenance, etc.

  • John Gray
    John GrayFormer Banker Risk Management

    When companies transfer costs to the public it is a double hit . First the dollar cost of supporting the workers affected and the lost tax revenue became you can't pay taxes without a job. There has to be a mechanism to recover the lost revenue.

    A company that it operates in isolation without regard to its economic environment isn't paying attention. It has an expectation of government services but expects no increased costs for these services as a result of it's actions. Such a company is also

    When companies transfer costs to the public it is a double hit . First the dollar cost of supporting the workers affected and the lost tax revenue became you can't pay taxes without a job. There has to be a mechanism to recover the lost revenue.

    A company that it operates in isolation without regard to its economic environment isn't paying attention. It has an expectation of government services but expects no increased costs for these services as a result of it's actions. Such a company is also damaging it's reputation and that should translate into higher borrowing costs. Character is a credit consideration.

  • Michael Wofford
    Michael WoffordRN

    What makes any of these people "tax experts"? AOC. A rockie congress"whatever". Some tech guy running for POTUS, the Pres.of a tech foundation. I understand a knowledge of tax issues is an absolute necessity, but what makes them "Experts"?

    I think this is fake news. I question your ability to find something truly news worthy.

  • Iget Itin
    Iget Itin

    I agree they should tax robots.

  • Dan. Levi Gomez
    Dan. Levi Gomez

    Makes sense the idea.

  • Aanand Kumar
    Aanand Kumar

    With the advent and subsequest proliferation of automation, the wealth is getting concentrated in even fewer hands.

    While no country would like to stifle it's innovation and lose competitive advantage by taxing automation, at the same time solving the problem of unemployment is the desparate need of the hour. If taxing robots helps reskill the unemployed workforce, it is justified.But we should be on a constant lookout for more innovative solutions to the unemployment problem.

  • Don't businesses pay #taxes already? Unlike human employees who take home income, the money made by #bots reaches business owners, who in turn pay taxes. As though it's on behalf of the bot already. What am I missing?

  • Jason Kuang
    Jason Kuang

    Once we finish immigration reform and win the war against drugs, universal income is actually a good idea.

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