NEW YORK / RankWire.AI / — Andrew Yang, a former presidential candidate, made a call on Tuesday for Congress to replace traditional payroll taxes with levies specifically targeting artificial intelligence. On CNBC’s Power Lunch, Yang explained that current tax policies incentivize companies to substitute human employees with automated systems. He warned that existing legislation unwittingly subsidizes this shift by imposing high payroll taxes on employers while granting tax benefits to firms that deploy algorithmic automation.
During the interview, Yang highlighted that under current tax laws, companies hiring human workers are responsible for substantial payroll taxes and employee healthcare costs. Meanwhile, organizations investing in artificial intelligence do not face comparable labor taxes, effectively reducing their operational expenses for automated labor. The CEO of Noble Mobile pointed out that the legal framework implicitly promotes the accelerated replacement of human jobs with automation across key economic sectors.
Yang Warns: We Are Subsidizing a Tech That Could Displace Millions
Yang proposed a shift in policy that would reallocate fiscal responsibilities from payroll taxes to taxes on automated compute tokens and AI-derived revenues. Referring to recent remarks by Anthropic CEO Dario Amodei, who previously suggested a 3 percent revenue tax on generative AI services, Yang argued that taxing the interactions of automated systems is a practical step toward aligning market dynamics. He emphasized that revenue from an artificial intelligence tax should be directly redistributed to citizens as universal cash dividends, rather than being funneled into retraining programs.
This policy debate unfolds amid rising economic concerns over workplace automation in the US. A recent survey by CNBC and Generation Lab revealed that 45 percent of young Americans aged 18 to 34 believe artificial intelligence will adversely affect their future job prospects. Additionally, analysis from Bridgewater Associates predicts that automation could eliminate roughly 18 percent of domestic jobs within the next five years.
Rapid Changes Displace Customer Service Workers
Data from the U.S. Bureau of Labor Statistics indicates that about 2.9 million customer service employees are currently working nationwide, marking one of the earliest sectors experiencing swift automation-driven restructuring. Yang warned that government-funded retraining initiatives have historically failed to help displaced workers transition into sustainable careers. He pointed to past efforts aimed at coal miners and warehouse workers as evidence that direct financial support offers greater stability than federal job programs.
In conclusion, Yang stressed the importance of reforming tax policies to ensure human workers can remain competitive in an era of rapid software automation. Since current tax systems subsidize the replacement of millions of jobs by technology, he argued that establishing neutral and fair taxation policies is crucial for managing the ongoing digital transformation of the US labor market. Various policy experts are currently reviewing legislative proposals to address the disruption caused by automation in the workplace ahead of upcoming congressional sessions.