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System Tax

Following on from my blog post outlining an A-Z of Digital, here is the final post in the series –  “Z for Zabeta”.

Zabeta is a noun meaning Tarrif or Tax.

“The Robots are Coming! So is the Tax!”

As we move towards an automated society with robots and automation playing a big part, there are ongoing discussions and debates at the moment around the position of taxing companies that use them to balance the loss of jobs they may cause.

Several key figures have raised the subject of a Robot Tax of some sort with Bill Gates being one of the key speakers on this subject:

Bill Gates 

“Right now if a human worker does you know, $50,000 worth of work in a factory, that income is taxed. If a robot comes in to do the same thing, you’d think we would tax the robot at a similar level.”

Bill Gates, in an interview with Quartz

Source: Marketwatch

Elon Musk

“There is a pretty good chance we end up with a universal basic income, or something like that, due to automation,” says Musk to CNBC. “Yeah, I am not sure what else one would do. I think that is what would happen.”

Source: CNBC

Stephen Hawking

Hawking replied: “The outcome will depend on how things are distributed. Everyone can enjoy a life of luxurious leisure if the machine-produced wealth is shared, or most people can end up miserably poor if the machine-owners successfully lobby against wealth redistribution.”

Source: The Independent

The debate has been discussed within the political landscape of the world with South Korea already making a move to introduce a Robot Tax:

In its recently announced tax law revision plan, the Moon Jae-in administration said it will downsize the tax deduction benefits that previous governments provided to enterprises for infrastructure investment aimed at boosting productivity.

Source: The Korea Times

In the US the state of California is considering a Robot Tax:

Included among those folks is San Francisco supervisor Jane Kim, who Wednesday launched a campaign called the Jobs of the Future Fund to study a statewide “payroll” tax on job-stealing machines. Proceeds from the tax would bankroll things like job retraining, free community college, or perhaps a universal basic income―countermeasures Kim thinks might make a robotic future more bearable for humans.

Source: wired.com

In the UK the political parties are discussing the subject with Labour wanting to introduce a tax in their policies

The Labour leader wants to use the money to create a fund to retrain staff who lose their jobs because of new technology. He said that “we should all get the benefits” from “greedy” global corporations such as Amazon which have “made a great deal of money out of incredibly advanced technology”.

Source: The Telegraph

where as the EU position is against the tax due to what has been seen in countries such as Germany where robots have been introduced, yet the unemployment figures are low.

Andrus Ansip, the European Commissioner in charge of the bloc’s push for a Digital Single Market (DSM), isn’t a fan of a robot tax. “No way. No way,” Ansip said when asked if he would support a robot tax.

Source: CNBC

The definition of what this is applied to is an important subject as well. When you mention the word Robot it conjures up images of a factory with robots producing cars, a humanoid type robot or something from a Sci-Fi movie. However should this include Cobots that are there to aid a worker to do their role or even RPA (Robotic Process Automation) which uses software to carry out a task.  Its easy to carry out a visual inspection of a site and see the big machine type robots, but less hard to spot the software variants.

What are the exceptions to the rule, such as Robots that enter a hazardous zone that is potentially dangerous or fatal to a human to carry out a task, such as mine clearance, clearing a nuclear site or diving to deep depths of the ocean. How far should such a tax system go?

This is one subject that will have the politicians and industries debating for some time to come.

What do you think -Should there be a tax of some sort?

Further Reading