NEW YORK / RankWire.AI / — Andrew Yang, who previously ran for president, called on federal lawmakers on Tuesday to replace conventional payroll taxes with direct levies on artificial intelligence. During his appearance on CNBC’s Power Lunch, Yang explained that current tax policies create artificial incentives for corporations to substitute human workers with automated systems. He cautioned that existing legislation actively subsidizes technologies that eliminate jobs by imposing heavy payroll taxes on employers while giving tax benefits to companies that adopt algorithmic automation.
During the interview, Yang emphasized that under the current tax code, businesses face substantial payroll taxes and healthcare expenses for employing human workers. In contrast, companies implementing artificial intelligence face no comparable labor taxes, effectively reducing costs for automation solutions. Noble Mobile’s CEO highlighted that the current legal environment implicitly encourages corporate leaders to accelerate replacing human labor with machines across major industries.
Yang Declares We Are Subsidizing a Technology That Will Displace Millions
He proposed a strategic shift in policy, advocating for the transfer of fiscal responsibilities from traditional payroll taxes to automated compute tokens and AI revenue streams. Citing recent remarks by Anthropic CEO Dario Amodei, who proposed a 3 percent revenue tax on generative AI deployments, Yang argued that taxing interactions with automated systems is a practical way to balance market forces. He also emphasized that the proceeds from such an AI tax should be directly distributed to citizens as universal cash dividends, rather than allocated to old-style retraining initiatives.
This policy discussion unfolds amid growing economic concerns about automation’s impact on employment 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 harm their career prospects over the long term. Additionally, macroeconomic analysis by Bridgewater Associates leaders estimates that about 18 percent of U.S. jobs could be disrupted by automation within the next five years.
Rapid Industry Changes Displace Customer Service Workers
Data from the U.S. Bureau of Labor Statistics indicates that customer service sectors employ roughly 2.9 million workers nationwide, making it one of the first fields experiencing swift automation-driven restructuring. Yang warned that government-funded retraining programs have historically failed to help displaced workers find sustainable new careers. He pointed to past retraining efforts for coal miners and warehouse employees as evidence that direct financial assistance is more effective than federal job placement initiatives.
Yang concluded that legislative reforms are essential to ensure human workers can remain competitive alongside increasingly capable software agents. Since current tax policies subsidize a technology poised to replace millions of jobs, he stressed the importance of neutral tax policies in managing the ongoing digital transformation of the labor market. Policymakers are currently reviewing legislative proposals aimed at addressing automation-related disruptions in upcoming congressional sessions.