NYC Mayor and Presidential Candidate Bill de Blasio Suggests Robot Tax

Sep 13, 2019 | Blog

Robot Tax 2019Our tax attorneys have learned that the mayor of New York City, Bill de Blasio–who is also a 2020 Democratic presidential candidate–has publicly endorsed something referred to as a “robot tax,” as well as the creation of a new government agency to oversee automation. De Blasio recently offered up his recommendation in an opinion article for Wired, where he described the tax as another alternative to Universal Basic Income–UBI–which has the support of de Blasio’s rival, Andrew Yang.

De Blasio’s idea would begin with a new government agency, which would be called the Federal Automation and Worker Protection Agency, or FAWPA. The role of the latter would be to govern the way companies automate jobs and would include strategies such as the removal of tax incentives for automation. According to de Blasio, the agency would also create a “permitting process” for any corporation that displaces workers through increased automation. For example, business owners would be required to provide severance packages to such employees or offer them different work for the same pay.

This actually isn’t the first time we’ve reported on a story regarding the taxation of artificial intelligence. In 2017 a San Francisco Supervisor proposed a robot tax as well.

Robot Tax Would Target Large Companies

De Blasio’s robot tax would target large corporations that phase out specific jobs in lieu of automation without offering new jobs to the employees being ousted. Such businesses would have to place five year’s worth of payroll taxes into a fund and the monies would then be used to develop high-employment, labor-intensive infrastructure projects. These projects would ultimately create new jobs in areas such as green energy and healthcare. Workers who lost their jobs due to automation would then be guaranteed positions in these fields at wages comparable to those earned before automation forced them out.

De Blasio stated that the current Universal Basic Income system is “woefully inadequate,” with Yang’s version only guaranteeing workers $12,000 a year. He stated that in contrast, the plan he recommends would fix this, as well as many of the other problems associated with the UBI system. 

De Blasio’s Goal a Work-Filled Future

Others have also harshly criticized UBI for additional reasons, such as the fact that the program cannot adequately solve employment problems on a large scale, and also has the potential to displace existing social programs. De Blasio claims that ultimately, UBI fails to notice the inherent value of jobs and essentially substitutes a monthly check for meaningful employment.

Robot Tax Supported by Other Well-Known Individuals

Other high profile individuals take a similar stance on the issue of automation and the elimination of jobs. For example, Bill Gates has stated that robots are taking jobs away from the humans who need them, and that this trend can be temporarily slowed down if governments tax such companies for doing so. Gates discussed the idea as far back as 2017, and recently stated that a robot tax could finance jobs such as those involved with caring for the elderly or working with youngsters in public schools. Democrat candidates, including Senator Bernie Sanders (I-VT) have also criticized the UBI and come out in favor of the robot tax. 

De Blasio’s robot tax remains hypothetical for now, as he stated he may leave the race unless he qualifies for October’s Democratic debates.  However, our tax attorneys think perhaps we have not heard the last about this tax and will watch for information concerning the robot tax in the future.

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