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Tax machines as workers?  Proposals weigh taxing automation equipment to replace lost worker income tax revenue COURTESY PHOTO

Tax machines as workers? Proposals weigh taxing automation equipment to replace lost worker income tax revenue

BY Sunday, March 05, 2017 04:29pm

As automation technology continues to advance, lawmakers and industry insiders are working to determine what role a new wave of robotic workers could play in the future social tax structure. 

In mid February, billionaire technology entrepreneur and Microsoft co-founder Bill Gates discussed his support for a tax on robotic equipment during an interview with Quartz, an online “new economy” publication. Around the same time, lawmakers rejected legislation introduced last year that would have imposed a similar tax on companies throughout the European Union. 

Both Gates’ proposal and the failed European legislation seek to replace lost tax revenues that result from robotic equipment taking the place of income-tax paying workers. 

Gates sees the tax as an extension of a larger societal push to encourage more workers to pursue positions in human-centric roles, such as caring for the elderly. 

“What the world wants is to take this opportunity to take all the goods and services today, free up labor and let us reach out to the elderly, help our neighbors, reach out to kids with special needs, all of those things are where human empathy and understanding are very unique,” he said in an interview with Quartz. “We still deal with an immense shortage of people to help there.”

Despite Gates’ intentions, the concept of a tax on robotic equipment — an idea still in its infancy nationwide — has been met with stiff resistance, particularly among manufacturers of automation systems.

Primarily, those companies worry about how such a tax would be defined and administered.

“What qualifies for a robot that would be taxed, as opposed to a robot that’s just doing something?” said Bryan Jones, CEO of Holland-based JR Automation Technologies Inc. “Are you going to go around to every household and tax the sweepers that are running around or washing machines because someone used to wash clothes?” 

Jones believes the proposal of an income tax on robotic equipment is an extension of the fear of automation technology taking over factory workers’ jobs. However, he notes most manufacturers are turning to robotic equipment because they cannot find enough qualified workers to fill open positions in the first place. 

“We’re doing things differently than how they’ve been done before,” Jones said. “Every manufacturer we’re working with is hiring and can’t find enough people. Is it shifting? Sure it’s shifting. (But) at the turn of the (19th) century, not every tractor got taxed because it was replacing a horse or an operator.” 

Moreover, Jones said that income tax opportunities created by new high-paying jobs in the robotics field could outpace the positions those robots replaced.

“It seems like a poor way to address an issue,” he said of the robotic equipment tax.  

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