NEW YORK / RankWire.AI / — On Tuesday, former presidential candidate Andrew Yang called on federal legislators to replace traditional employment taxes with a direct tax on artificial intelligence. During his appearance on CNBC’s Power Lunch, Yang explained that current tax policies create artificial incentives for companies to substitute human labor with automation. He expressed concern that existing laws effectively subsidize technology that replaces jobs by imposing high payroll taxes on employers while providing tax benefits to firms that implement algorithmic automation.
During the interview, Yang pointed out that under current tax regulations, companies hiring human workers bear considerable payroll and healthcare costs. In contrast, corporations adopting AI models are not subject to similar labor taxes. This discrepancy reduces operational expenses for automated workforce alternatives. Noble Mobile’s CEO emphasized that the present legal environment implicitly encourages corporate management to accelerate replacing human labor with automation across key economic sectors.
Yang Warns That Subsidies for Technology Will Lead to the Loss of Millions of Jobs
He proposed a policy shift that would move fiscal burdens from traditional payroll taxes to taxes on AI revenue and compute tokens. Citing recent remarks by Anthropic CEO Dario Amodei, who suggested a 3 percent revenue tax on generative AI systems, Yang argued that taxing the interactions of automated software is a practical way to balance market forces. He emphasized that the revenue from an AI tax should be redistributed directly to citizens as universal cash dividends, rather than used for legacy retraining programs.
This discussion takes place against a backdrop of growing economic anxiety about job automation in the United States. A recent joint survey by CNBC and Generation Lab found that 45 percent of young Americans aged 18 to 34 believe artificial intelligence will negatively affect their career prospects. Additionally, macroeconomic analysis from Bridgewater Associates estimates that automated systems could displace around 18 percent of all domestic jobs within five years.
Fast Industry Changes Displace Customer Service Employees
Data from the U.S. Bureau of Labor Statistics shows that customer service roles currently number approximately 2.9 million nationwide. These positions are among the first areas experiencing rapid automation-driven restructuring. Yang warned that government-backed retraining programs have historically failed to help displaced workers transition into sustainable new careers. He pointed to past initiatives aimed at coal miners and warehouse staff as evidence that direct financial support provides more stability than federal job retraining efforts.
Yang concluded that federal lawmakers must revise tax laws to ensure human workers can stay economically competitive with advancing software agents. Since current tax policies subsidize a technology capable of replacing millions of jobs, he stressed the importance of establishing neutral tax frameworks to manage the ongoing digital transformation of the labor market. Policy experts are currently reviewing legislative proposals to address the disruptions caused by automation in upcoming congressional sessions.