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The taxman will eventually come for AI, too
- siwakotisaurav 3y agoWhat did I just read? Taxes that a computer program pays?
- AmericanChopper 3y agoThe article is based on a fundamentally stupid premise > So it won’t be possible to assign all AI income to their human or corporate owners, as in many cases there won’t be any. It’s not possible for something to be owned without a legal entity being the owner. Whether that’s a real person or a corporate one. For an autonomous agent to come into possession of an income in the absence of an owner, some type of fraud must have occurred, which would invalidate the basis of any “property rights” the author is supposing it might have. The authors idea of laundering your labour through an autonomous agent is even more fantasy based. Honestly who approves this sort of thing for publication?… seems like it’s just playing into peoples fear of AI
- re-thc 3y agoOr AI will replace the Taxman 1st. From now on a bot will process your tax returns.
- hardlianotion 3y agoAnd a related question. Does taxation imply representation?
- aardvark179 3y agoAh yes. The future war will not be man vs. the SkyNet. No, it will be man vs. SkyNet, the District of Columbia, and Puerto Rico.
- cardboardbach 3y agoIf GPT-4 has, say, five representatives in Congress, are those five separate entities? Or are they all one GPT-4? And also the same entity that they represent? What happens if term limits get imposed? Does GPT-4 leave office only for GPT-4 to replace it?
- justrealist 3y agoThe uncomfortable answer is that our structure of congressional representation is a balance between finesse and complexity, because the average person (and less so the average group of people) can only hold a small number of moving parts in their head at a time. The representation structure that GPT-5,6,7,... would design is going to be incomprehensibly more complicated and nuanced than 1 person = 1 vote. I don't know what it is, but you're trying to map an alien onto human institutions in a way that is not sensical.
- the_lonely_road 3y agoDrivel. Where are the AI agents doing value add work out there owned by no one? How much do the robots at car factories pay in tax today? The arguments make no sense in the foreseeable future. Maybe some future word post AGI but even then, until we have robots earning and spending money with no human owners in the mix this is not a serious line of thought.
- h4kor 3y agoWe don't tax machines doing manual work either. One simple solution would be to stop taxing work and tax profits instead.
- hahajk 3y agoOr tax the use of natural and shared resources [1]. The idea that somewhere out there value is being created and the govt isn't getting a cut of it is wicked. [1] https://en.wikipedia.org/wiki/Georgism https://en.wikipedia.org/wiki/Georgism
- phpisthebest 3y agoNice to see another Georgist out there... Too many people thing the only way to fund public programs is taxing labor or income, when that is the most unethical and least efficient method of taxation there is, and leads to all kinds of abuse by government.
- indymike 3y agoActually, we do tax machines that do manual work with property tax.
- plasticchris 3y agoWe do tax profit, but it’s funny some companies just never make any…
- simonh 3y agoThere should always be people that are responsible for these AI agents. You can't just let loose a robot such as a self driving car in a town centre and then deny responsibility for the consequences. I can't leave a loaded gun on a bench in the street and then claim whatever happens as a result is nothing to do with me. Similarly if you let an autonomous agent loose on an economy there should be a chain of responsibility for it's actions.
- chank 3y agoI had a fair bit of reflection on this topic recently. While AI shouldn't be taxed itself, there should definitly be heavy and unavoidable increased taxes for companies that deploy/employ it. AI is definitly comming for every job. Not if, when. When is the tricky part, but it will eventually get there. Either that or our economy needs drastic changes in economic incentives.
- varelse 3y ago[dead]
- louison11 3y agoThe combination of AI, the digitalization of society and decentralized protocols pretty much means that taxation of work is going to become increasingly hard. You already can hardly tax a software company incorporated in Hong Kong (with 0% tax on foreign income) How can you tax an AI paid in digital currencies and incorporated nowhere? Ultimately, we might have to drastically change how and where we tax people. There are many theories on this. I like geolibertarianism: tax the extraction of natural resources/land ownership.
- RandomLensman 3y agoAn AI would need to be able to own something in order to get paid. If the AI cannot own anything, then you can tax the AI owner.
- pydry 3y agoGeolibertarianism is probably an ideal from the perspective of a fair society but it would probably require quite significant violence to achieve. Similar to republicanism during the French revolution or the spread of communism in the 50s, it would likely invite invasion from foreign nations run by elites that are acutely aware of the threat this ideology poses to their power and privilege. Even getting it on the agenda in a democracy is a struggle against entrenched oligarchs who own a propaganda megaphone: https://www.dailymail.co.uk/news/article-4575382/How-Labour-garden-tax-hit-YOU.html https://www.dailymail.co.uk/news/article-4575382/How-Labour-... (LVT strictly speaking exists in a few places like Hong Kong but it's always very low, way below the threshold where it would be considered a threat - e.g. 3%)
- blackoil 3y agoA click bait article cashing in on AI hype. We don't tax machines, we tax the owners for profit generated. And if we have autonomous AIs not owned by anyone, tax wouldn't be the primary problem.
- seydor 3y agoIs this a joke article? It's not april 1st But let me go on a tangent. When will we have AI governments and AI taxmen? Would I rather work or for the taxman of some loudmouth who convinced people to vote him in the ballot , or for an AI that is proving to improve every year (with politically- and hopefully democratically defined criteria)? And how are our intellectuals preparing us for this instead of dooming-and-glooming about AI ?
- pjc50 3y agoSid Meier's Alpha Centauri "Cybernetic" government type? Not a particularly useful line of inquiry unless you're willing to get full political and legal realist with a dash of Mao, and ask: how is the cybernetic government kept in power? Who's pulling its strings?
- j0hnyl 3y agoWhile we are at it, let's tax the fridge and the oven, maybe even the car. Those doors that open automatically? Definitely getting taxed.
- Tangurena2 3y agoWhy do you hate the Sirius Cybernetics Corporation so much?
- alenrozac 3y agoUnpopular opinion, but AI should be taxed per use like with current tokens. No VAT schemes, but straight to a sovereign wealth fund's account. There will be disruption, we will need new bodies regulating this domain. We don't want existing institutions overseeing AI - this is a new domain. We can only do this credibly if we secure new sources of revenue for this reason. Ultimately, AI tax should contribute to a SWF only to be redistributed as UBI. I wasn't keen on the idea of Basic, but it makes sense in an AI-augmented sci-fi society.
- Nextgrid 3y ago> AI tax should contribute to a SWF only to be redistributed as UBI Problem is that in practice they will be mismanaged by some senile politicians and end up in the pockets of a few well-connected individuals. I'm all in for fair taxation to provide a good safety net for people, but we first need to ensure those taxes are actually being used efficiently and not as politicians' friends slush funds or cash cows for consultancy companies.
- alenrozac 3y agoSo AI companies can do learning by doing, but govt can't? hm
- Nextgrid 3y ago> AI companies can do learning by doing, but govt can't AI companies can't use the law to force me to pay them. Governments can and do.
- alenrozac 3y agoTouche. I'd still lean to implementation. Something like stealing from SWF would drastically impact sovereign rating and sovereign's ability to borrow.
- mschuster91 3y ago> Problem is that in practice they will be mismanaged by some senile politicians and end up in the pockets of a few well-connected individuals. Norway and the Alaska Permanent Fund prove that this is not necessarily the case. The problem is there are relatively few SWFs in the world, and those that exist tend to be in oil dictatorships where no one is allowed to question the ruling class.
- pydry 3y agoIt's absurd that income generated from productive work is even taxed at all while there is such a wealth of rents to tax - land, intellectual property, etc. Especially land. Tyler Cowen would be one of the least likely economists to ever acknowledge this though.
- pjc50 3y agoRather surprising to see Tyler Cowen making an anti-capitalist argument: AI is after all just a form of fixed capital, in the same way that a machine tool is. The "unowned" argument is obviously not something that should be given the time of day, since valuable capital assets that require energy inputs are always going to have an owner, but it might raise more serious jurisdiction questions as to what law applies to an AI and content put out by AI.
- expertentipp 3y agoLet's start with AI coming to complete our tax declarations, without any need to review.
- version_five 3y agoThe only concerning thing is that someone somewhere in government will be stupid enough to push for this. Maybe Excel could add a feature where taxes are collected every time you add a trend line to a chart. I hope they charge more for polynomial fit - it should be based on number of model parameters right?
- ralmidani 3y agoI’m firmly in the “AI will never be a sentient being and shouldn’t be expected to have rights” camp. Accordingly, AI won’t be sending kids to public schools, collecting Social Security, or benefiting from Medicare. Most importantly, AI won’t have seats in Congress. If AI does productive work, individuals and organizations who leverage it successfully will make more money, which is taxed progressively (in theory anyway). At higher brackets, income tax can bring in more revenue than payroll taxes.
- GalenErso 3y agoI really liked the perspective the video game Detroit: Become Human gave on the issue of AI rights. Tl;dr Humanoid robots may one day demand equal rights, and they may get them.
- elif 3y agoCommenters seem to be dismissing this concept outright while ignoring the fact that the owners of these robots, through corporate schemes, offshoring, and legal tax manipulation, end up paying 0-10% tax compared to 20-45% taxes paid by human workers currently. It is not a zero-sum calculation and AI/robots represent a huge transfer of social wealth (taxes collected for use by society) to the rich. This "income tax for robots" idea is one of Bill Gates' ideas that has been kicking around for over a decade, and will surely fall victim to the same type of loopholes the rich presently exploit. Yanis Varoufakis has been criticizing this Gates approach and proposing an alternative concept which he calls Universal Basic Dividend. Under this scheme, the use of automation to generate capital would be socialized through the generation of shares, say 10% ownership of the firms which utilize automation to replace labor, which are owned by a public trust which distributes dividends from the firm's profit to every human in the country equally.
- version_five 3y agoWhy is it important to start this ~200 years into the industrial revolution? What is actually different now? If anything we're (well) into diminishing returns.
- elif 3y agoCapitalism until now has functioned on the premise that reward for human labor was a necessary component of generating capital.
- version_five 3y agoThat doesn't mean anything to me but maybe it's persuasive for somebody. We already have mechanical harvesters and computers and looms and whatnot. I don't see a step change at llms. One thing that's different (if you buy into the hype) is that the jobs that are threatened this time are held by educated people. When it was truck drivers (now a lucrative job in no danger of replacement) being threatened, we told them they could learn to code. Now that people writing code and doing powerpoints (if you believe the hype) are threatened, we need UBI
- neonate 3y agohttps://archive.md/fl3ZF https://archive.md/fl3ZF
- bparsons 3y agoThere is a reasonable argument that companies who employ a lot of people per unit of profit/revenue should pay a lower rate of tax on those profits. If you create a fleet of robo-semi trucks and take over the American logistics business by cutting 80% of the transportation workforce, you are creating significant social harm in the pursuit of profit. Increased taxation could either act as a disincentive to the labour-pocalypse or provide revenue to help society smooth the career transition for those workers. This of course will never happen in the US.
- bitshiftfaced 3y agoIf AI automates away the workforce to the point that we have less annual tax receipts, then I'd also expect two other things to happen: 1) Everything becomes cheaper due to this automation, and 2) The cost of public services that these taxes pay for become cheaper due to this automation
- swexbe 3y agoSo essentially the value of capital increases? Sounds fair.
- Pmop 3y agoYeah but people will still have to generate excess produce somehow in order to have something to trade for those (now cheaper) goods, and with automation taking both skilled and unskilled jobs out of the market, I keep wondering what kind of jobs will be left available for the average Joe.
- chmod600 3y agoWhy do we tax human labor at all? We could just tax consumption, which would have obvious environmental benefits.
- PopAlongKid 3y agoWe (U.S) don't tax human labor. You can invest countless hours of your own effort into creating and/or improving property (including intangible property) and never pay a cent in tax. Instead, we tax income.
- UncleEntity 3y agoAnd consumption in the form of sales tax.
- chmod600 3y agoOk, why do we tax income and capital gains (which have few externalities) vastly more than consumption (which has a lot of externalities)?
- rmah 3y agoTaxing consumption discourages consumption which thus acts as a drag on the overall economy. Further, most people view it as "unfair" because a fixed consumption tax (sales, GST, VAT) results in lower income people paying a higher percentage of their income as tax. Progressive income taxation 1) does not discourage consumption as much as a higher consumption tax for those with lower income (which is most people), 2) encourages investment for companies and individuals with higher incomes.
- alexschnapp 3y agoIt’s like saying we should tax how stuff is transported based on how fast a human walks and how many humans it takes to transport that kind of size and weight. We can set this metric before the wheel was invented where we could only carry stuff on our backs. How is AI any different?
- johnea 3y agoAnd then! he's gonna come for your BURGER!!!
- MLH6ft1 3y agoIdk who the author is and how good he is but this is such a clickbait article, that I couldn't resist commenting. I mean the article starts with the claim (and which I think is clearly untrue) that "there are now autonomous AI agents, which can in turn create autonomous AI agents of their own". Emphasis is on the use of the words "there are now". As of yet, I have not come across any AutoGPT/BabyAGI variants which can 'create' new agents or agents of their own. To top it off, this claim is supported by a tweet, which nowhere states/mentions any AutoGPT/BabyAGI variant which is capable of creating their own agents. But lets move beyond the tech aspects, since the article doesn't really discuss anything about it anyway and because I know a thing or two about tax law. Now considering that this article is being published on Bloomberg (that too on a topic such as taxation) and that the author is an economics professor, one would assume that the article would discuss some real life issues or some practical issues in taxation of AI related services. But no no, clickbait-worthy articles require some clickbait-worthy content and hence we see some hot tax law takes mentioned in this article. I have extracted them below: (1) "Why own an AI and pay taxes when you can program it to do your bidding, renounce ownership, and enjoy its services tax-free? It seems easy enough to disclaim ownership of autonomous bots, especially if they are producing autonomous bots of their own." - I mean how can an article on tax law ever be complete without mentioning tax avoidance strategies?? ALL YOU NEED TO DO IS TO RENOUNCE (LEGAL) OWNERSHIP AND THAT'S HOW EASY IT IS TO AVOID TAX! and no the tax authorities will not question you as to why are you receiving money from an AI on a regular basis -_- (2) "Additionally, maybe there should be a kind of gift tax, paid by humans, on any benefits we receive from an AI, whether we own it or not." - Of course, why not? because when calculators are used to solve problems faster, the money earned from such problem solving using calculators was also taxed at higher rates than if you would had solved the problem without using one. Apparently that's how governments' use tax policies to promote innovation - tired of the existing monopolies? Want to come up with new solution? No problem, just be ready to pay higher taxes! (3) "AIs might be very good at providing in-kind services — improving organizational software, responding to emails, and so on. It is already a problem for the tax system when neighbors barter services, but the AIs will take this kind of relationship to a much larger scale." - Wtf? Let's not even discuss the stupidity in: (i) comparing an AI as your neighbour, and (ii) assuming that availing of services from an AI will be the same as a barter exchange between you and your neighbour. Let us stick to tax law. Since when did it become a good reason for governments to impose taxes on companies for implementing 'cost saving measures' such as use of LLMs for generating email responses? Were any taxes imposed on companies when they started communicating through Email instead of physical mail? or when they started conducting virtual meetings instead of physical meetings? (4) "Forget about hiring AIs, actually: What if you invest in them, tell them to do your bidding, repudiate your ownership, and then let them run much of your business and life? You could write off your investment in the AI as a business expense, and subsequently receive tax-free in-kind services, in what would amount to a de facto act of exchange." - If I am to write off my investment in the AI as a business expense, how will I repudiate/renounce my ownership in the AI?????? If I am investing in an AI and the AI will generate money for me, how will it be considered a de-facto exchange (this is how investments usually work, so all types of investments should be considered de-facto exchange)??? Moreover, if the AI is capable enough to "run much of my business and LIFE" then I don't think we should be worried about, TAXATION, of all other things.