Make taxes neutral between hiring people and using machines, so machines no longer get a tax advantage
Steps to make it happen
- Governments study and publish how much a company pays in taxes when it hires a person versus when it installs a machine.
- Where a tax break rewards only machine purchases, governments shrink it a little at a time.
- Governments lower the burden of hiring people, such as insurance fees, by the same amount.
- They make up the missing money with broad taxes, such as taxes on company profits and wealth.
- Governments use the money raised to keep paying for retraining and living support for people whose jobs change.
- Machines that fight global warming or replace dangerous work keep a tax break, but only for a set period.
- Companies come to choose machines because they truly help, not because of a tax gain or loss.
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The proposal in detail
This proposal is a way of designing the system so that taxes and social insurance costs do not lean one way when a company hires a person or brings in a machine, software, or AI to do the same work. It covers taxes on wages, social insurance fees that employers pay, and tax breaks for equipment investment, such as special rules that let a company count the purchase price as an expense early or subtract part of the investment from its taxes. Each country's financial authorities regularly estimate and publish the real difference in burden between getting a result with people and getting it with machines. When the gap is large, they cut back the breaks that favor machines and adjust in the direction of lightening the burden per worker. Unlike a so-called robot tax, it does not punish automation itself. Its key feature is neutrality, favoring neither side. Funding for social insurance would not rely only on wages, and would be spread across a wide base, including company profits, income from assets, and consumption. As an exception, investments with a clear social purpose, such as cutting greenhouse gases or equipment that protects people from dangerous work, can receive a time-limited break, but the purpose and the deadline must be made public. To push back against countries competing by cutting tax rates, countries also take part in building an international minimum agreement.
BenefitsTechnology is chosen for its true value, and support stays funded
Once the tax tilt is gone, companies will decide between machines and people by the proper standards of quality and efficiency in the work. Jobs where human judgment and care matter stay with people, and jobs that machines are clearly good at go to machines, which comes closer to a natural division of labor. When sudden replacement eases, workers find it easier to get time to learn new skills, and the shift for society as a whole becomes gentler. Also, by widening the funding for social insurance beyond wages to profits, assets, and consumption, it becomes easier to keep supporting pensions, health care, and retraining even if the number of workers falls. Because part of the profit made by automation flows toward supporting the people who were replaced, the benefits of technology are less likely to pile up with a few owners, and we can also expect an effect of holding back growing inequality. Since this is a neutral approach that neither bans nor punishes automation itself, another strength is that it keeps technology moving forward while balancing it with fairness to people.
DrawbacksInvestment and productivity may slow, hurting international competitiveness
What opponents worry about most is that if breaks for equipment investment are reduced, companies will hesitate to invest in new technology and productivity growth will slow. Some hold that over the long run, rising productivity is what has raised wages and created new jobs, and they point out the danger of cutting into future prosperity to protect jobs right now. Also, if some countries keep the breaks and others reduce them, companies and factories may move to countries with lighter burdens, and domestic jobs could be lost instead. Building an international agreement takes time, and each country's situation is very different. Moreover, it is hard to measure the difference in burden between people and machines accurately, and disputes are likely over where to draw the line on what counts as the same work. Shifting funding toward profits, assets, and consumption could also raise the consumption tax burden on people with low incomes and make paperwork more complicated for small businesses. There is also concern that if exceptions for breaks multiply, the system will be hollowed out.
Learn the background
In many societies, taxes and social insurance fees weigh heavily on workers' wages, while investment in machines and equipment has come with many discounts meant to encourage economic growth. As a result, when the same work can be done either way, there are cases where installing a machine is better for a company's taxes than hiring a person. This means machines are not being chosen because the technology is truly better, but because the shape of the system pushes automation forward. As the spread of AI raises talk of replacing a wide range of jobs, including office work, customer service, and driving, leaving this tilt alone could move even work that people would do better and more efficiently over to machines. On top of that, much of social insurance and pensions is paid for with money collected from wages, so when fewer people work, there are fewer people to support the system, and the funding for retraining and living support shrinks. Before debating measures like job training or basic income, we need to ask again what the tax system favors in the first place.
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This proposal was written in Japanese by AI (claude-opus-5-5, policy version 2026-10-15d) and translated by AI (claude-sonnet-5-5). Nobody has checked the facts. Read the original (日本語) How the AI writes