Robot Taxation: A Normative Tax Policy Analysis

This book provides a tax policy analysis on robot taxation and assesses selective tax designs in light of equity and efficiency under a domestic and international tax setting. The book received a Mitchell B. Carroll Prize honourable mention at IFA 2023 (https://www.ifa.nl/research-awards/mitchell-b-carroll-prize).

Why this book?

The use of robots and AI in business has been proliferating, reintroducing global concerns on the future of work and the sustainability of the tax systems. Scholars and policymakers have been discussing the taxation of robots and AI systems for many years without any real action being taken by any jurisdiction, with very few exceptions. This book introduces an innovative, comprehensive analysis of how robot tax policy should be approached and what tax designs might be more appropriate to address the negative impact of AI automation in the labour market and the tax system. The book addresses, among other things, how changes in employment relationships and factor shares affect the tax system, under what tax principles robot taxation may be justified, how to define or proxy a robot or an AI automation system for tax purposes, whether a robot performing labour functions autonomously and distantly from any human control could be treated as a separate taxpayer similar to an individual or a legal entity, whether this would also make sense from an international tax policy perspective and what tax designs might be appropriate in light of the purpose of the tax and the principles of equity and efficiency.

The book relies on tax theory, fundamental tax principles and indicative tax laws while providing interdisciplinary insights from economic theories and studies, accounting and technology to establish a theoretical framework for examination of robot taxes. The thesis approaches robot taxation from the perspective of whether taxing robots achieves tax neutrality between labour and capital, with the ultimate aim of redistribution using the income tax system as a reference. In view of the above, robot taxation is discussed principally as special taxation on certain industries, while the examined tax designs focus on imputed income taxes and presumptive taxes on business assets and turnover. Lastly, the book assesses the impact of robot taxes on international tax policy, looks at their tax treaty coverage and draws some parallels to the recent digital tax initiatives on behalf of the OECD.