NEW YORK / RankWire.AI / — On Tuesday, former presidential candidate Andrew Yang urged lawmakers to overhaul existing tax policies by replacing traditional labor taxes with levies targeting artificial intelligence. During his appearance on CNBC’s Power Lunch, Yang explained that current tax frameworks incentivize companies to substitute human employees with automated systems. He warned that current laws inadvertently support the adoption of labor-displacing technology by imposing high payroll taxes on employers while providing tax benefits to those deploying algorithms and automation.
Yang emphasized that existing tax codes require businesses to pay substantial payroll taxes and healthcare costs for human workers. In contrast, companies utilizing artificial intelligence do not face similar labor taxes, which effectively reduces operational expenses for automated alternatives. The CEO of Noble Mobile highlighted that this legal environment unintentionally encourages corporations to accelerate automation across key sectors of the economy.
Andrew Yang Warns of Massive Job Losses from Subsidized Technology
Yang proposed a strategic policy shift to shift fiscal responsibilities away from traditional employee payroll taxes toward taxes on automated compute tokens and AI-generated revenue streams. He referenced recent comments from Anthropic CEO Dario Amodei, who suggested a 3 percent revenue tax on generative AI applications. Yang argued that taxing interactions with automated systems offers a practical way to realign market incentives. He further stated that revenue from an AI tax should be directly redistributed to citizens through universal cash dividends, rather than funneled into retraining initiatives.
This discussion unfolds amid growing economic concerns related to workplace automation in the United States. A joint survey by CNBC and Generation Lab revealed that 45 percent of young Americans aged 18 to 34 believe artificial intelligence will have a negative impact on their long-term career prospects. Additionally, macroeconomic forecasts from Bridgewater Associates’ executives project that automation could threaten approximately 18 percent of U.S. jobs within the next five years.
Rapid Changes in Customer Service Roles Signal Industry-Wide Automation
Data from the U.S. Bureau of Labor Statistics shows roughly 2.9 million workers are employed in customer service nationwide. This sector is among the first to experience swift automation-driven restructuring. Yang warned that federally funded retraining programs have historically failed to help displaced industrial and administrative workers transition into sustainable careers. He pointed to past initiatives aimed at coal miners and warehouse staff as evidence that direct financial support offers more stability than government job programs.
Yang concluded that federal lawmakers must amend tax laws to keep human workers economically competitive as AI and automation rapidly evolve. Since current policies subsidize a technology poised to displace millions of jobs, he emphasized the importance of establishing neutral tax policies to navigate the ongoing digital transformation of the national workforce. Policymakers are actively reviewing legislative proposals to manage automated workplace disruptions in upcoming congressional sessions.