Bill Gates Calls For A Robot Tax

Robots shouldn’t just waltz in and steal jobs away from people, government should tax companies using robots.

Bill Gates recently suggested that robots shouldn’t just waltz in and steal jobs away from people, that the government should tax companies using robots, so that the speed of automation slows down a little and gives society time to adapt.

This money would, among other things, go toward helping those on lower incomes transition into new jobs. “I don’t think the robot companies are going to be outraged that there might be a tax,” Gates told Quartz. “It’s OK.”

Quoting from a McKinsey report, Recode, a tech news website said that robots are now capable of taking over 50 percent of human jobs. This could cost the United States around $2.7 trillion.

The idea is not totally theoretical: EU lawmakers considered a proposal to tax robot owners to pay for training for workers who lose their jobs, though on Feb. 16 the legislators ultimately rejected it. As SIA Update has reported in the past, some robots are finding homes in security applications such as security guards. 

But Gates said he fears that if it were all allowed to happen without any “grace period” of buffer, the displacement of people would be too chaotic.

“You ought to be willing to raise the tax level and even slow down the speed” of automation, Gates argued in the Quartz article. That’s because the technology and business cases for replacing humans in a wide range of jobs are arriving simultaneously, and it’s important to be able to manage that displacement. “You cross the threshold of job replacement of certain activities all sort of at once,” Gates said, citing warehouse work and driving as some of the job categories that in the next 20 years will have robots doing them.

A 2016 report by the Organization for Economic Cooperation and Development estimates the job loss to be low, with 9 percent of jobs automatable on average across 21 OECD countries. A 2013 report by Oxford University’s Carl Benedikt Frey and Michael A. Osborne estimated 54 percent of jobs in the EU to be at risk of disappearing under the influence of computerization in the next two decades, while a follow-up 2016 report pronounced 47 percent of US employment to be at high risk of imminent automation, “perhaps over the next decade or two.”

Barb Jacobson, a board member of Universal Basic Income Europe, a lobby group promoting basic income in Europe, noted that the basic research resulting in new technology patents is often funded with public money. She said: “It is only fair that those who profit from the use of patents pay some of that back, and that the revenues from a ’robot tax’ be shared by all in the form of a basic income.”

Patrick Schwarzkopf, director of the Brussels-based EUnited Robotics trade association, pointed to data from the International Federation of Robotics indicating high employment rates for countries with high robotization levels. “Empirically, the evidence doesn’t really show that high robotization means lower employment. That’s the counterintuitive thing about it,” he told Bloomberg BNA in an interview. “Introducing a robot tax is basically a solution to a problem that doesn’t exist.”

Both robotics manufacturers and economists moreover tend to point out that automation also creates jobs. A 2015 Deloitte report concluded that technology potentially played a part in the disappearance of 800,000 lower-skilled jobs between 2001 and 2015, but also contributed to the creation of almost 3.5 million higher-skilled jobs.

SIA's Take: Tax robots, but then do they also receive a paycheck? Also, would a robot tax reduce the incentive for companies to innovate and prompt them to relocate to other jurisdictions that don’t levy taxes on automation technologies? This issue clearly needs more research.

And if that’s not enough, visit http://www.reuters.com/article/us-europe-robots-lawmaking-idUSKBN15V2KM