NEW YORK / RankWire.AI / — On Tuesday, former presidential candidate Andrew Yang called on federal lawmakers to replace traditional labor taxes with direct levies on artificial intelligence. During his appearance on CNBC’s Power Lunch, Yang highlighted that current tax policies inadvertently encourage companies to substitute human workers with automated systems. He warned that existing laws effectively subsidize automation technology by imposing high payroll taxes on employers while granting tax advantages to businesses that deploy algorithmic solutions.
In the interview, Yang explained that under current tax regulations, companies face substantial payroll taxes and healthcare costs for hiring human employees. Meanwhile, firms utilizing artificial intelligence face no comparable labor-related taxes, which reduces the overall expense of replacing human labor with automation. Noble Mobile’s CEO stressed that the current legal landscape implicitly promotes the accelerated adoption of automated labor across key sectors of the economy.
Yang Warns That We’re Subsidizing a Technology Set to Displace Millions
He proposed a shift in policy that would move fiscal responsibility away from traditional payroll taxes towards taxes on automated compute tokens and AI revenue streams. Citing recent remarks by Anthropic CEO Dario Amodei, who suggested a 3 percent revenue tax on generative AI systems, Yang argued that taxing interactions with automated software offers a pragmatic approach to maintaining market balance. He emphasized that revenue from an AI tax should be redistributed directly to citizens as universal cash dividends, rather than allocated to outdated retraining programs.
This debate unfolds amid rising economic concerns about workplace automation in the U.S. A recent joint survey by CNBC and Generation Lab found that 45 percent of young Americans aged 18 to 34 believe AI will negatively affect their long-term job prospects. Additionally, macroeconomic forecasts from Bridgewater Associates’ executives estimate that automated platforms could threaten roughly 18 percent of all U.S. jobs over the next five years.
Displaced Customer Service Workers Face Rapid Industry Changes
Based on data from the U.S. Bureau of Labor Statistics, customer service roles employ about 2.9 million workers nationwide, making this sector one of the first to undergo rapid automation-driven restructuring. Yang warned that government-led retraining initiatives historically failed to help displaced workers transition into sustainable careers. He pointed to past efforts aimed at coal miners and warehouse workers as evidence that direct financial support provides more stability than federal job programs.
Yang concluded that lawmakers need to reform tax laws to keep human workers competitive alongside advancing software agents. Since current tax frameworks subsidize technology that will displace millions of jobs, he stressed that establishing neutral tax policies is crucial to managing the ongoing digital transformation of the labor market. Legislators and policy experts are currently reviewing legislative proposals to address automation-related disruptions in upcoming congressional sessions.