If AI destroys job markets, governments will need to make up the resulting shortfall in labour income tax receipts
The accelerating capabilities and expanding applications of AI are bringing the discussion of its economic impact, particularly on employment, to the forefront among policymakers.
Governments and international bodies are beginning to grapple with the potential economic disruption caused by AI, necessitating new fiscal strategies to maintain social stability and funding for public services.
The focus is shifting from purely technological development of AI to its societal and economic consequences, requiring proactive government planning for anticipated revenue shortfalls.
- · Governments exploring new tax models
- · Economists specializing in automation and UBI
- · AI ethics and policy think tanks
- · Traditional labor-intensive industries
- · Governments reliant solely on income tax
- · Unskilled workforce
Reduced labor income tax receipts due to AI-driven job displacement and automation.
Governments will explore alternative revenue streams, such as robot taxes or AI profit taxes, potentially leading to new forms of economic regulation.
Introduction of universal basic income or similar social safety nets becomes a fiscal necessity, reshaping the social contract and relationship between citizens and the state.
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Read at Financial Times — Technology