UK
Labour considering ‘robot tax’ for firms that replace staff with AI

Will Hazell
Sat, 4 November 2023 

Will artificial intelligence wipe out jobs? - Chainarong Prasertthai/iStockphoto

Labour frontbenchers have been considering a “robot tax” that would target companies that sack staff and replace them with artificial intelligence, The Telegraph can disclose.

The idea has been raised during discussions with third-party organisations, and was suggested by Alex Davies-Jones, the shadow minister for technology and digital economy, at a fringe event at last month’s Labour conference.

It suggests a possible revival of a “robot tax” mooted during Jeremy Corbyn’s leadership.

However, the party has since sought to play down Ms Davies-Jones’s comments.

The breakneck speed with which AI is advancing has raised the prospect of huge swathes of the economy becoming automated in the coming years, with the investment bank Goldman Sachs predicting earlier this year that AI had the potential to replace 300 million jobs globally.

Speaking at a Labour conference event organised by the think tank Demos, Ms Davies-Jones suggested that the tax system could be used to discourage AI-related redundancies.
UK sees ‘very real threats’

Ms Davies-Jones said that the UK was already seeing “very real threats” involving “AI taking jobs”, with the issue being felt in her constituency of Pontypridd in South Wales “where we’re seeing automation come in”.

“We’ve all seen it in our shops where there’s no longer people on the tills, you have all of these machines working, people are losing their job. We’ve seen big employers cutting jobs and claiming AI is a result of that.”

She then went on to suggest that companies making such decisions could be required to pay more tax.

“What we’re saying is that if you’re a big business and you’re coming to the UK and you are potentially cutting jobs, then you’re saving money, so where should that money be going back?

Alex Davies-Jones - ROGER HARRIS

“Should you be investing that money back to the taxpayer? Should that money be coming back to government?”

She suggested that companies using AI to create jobs could likewise see their tax bills go down.

“If you’re a business and you want to come to the UK and you’re creating jobs because of AI, then should we be giving you those incentives to do so? That’s definitely something we’re looking at in terms of policy.”

Ms Davies-Jones acknowledged that a Labour government would need to be careful that its policies did not scare international companies away.
‘We have to get the balance right’

“We don’t want them to leave us and go elsewhere,” she said. “So it’s about how we get that balance right.”

A spokesman for the party said: “Ideas that are not Labour Party policy are discussed at fringe events at the Labour Party conference.

“The Labour Party has no plan to tax business for using AI. Our policy is to harness the potential of AI to deliver better public services and get the economy growing.

“Labour recognises that because of Tory failure to grow the economy, the tax burden is at its highest level for 70 years. Labour’s plans would bring stability and economic security to make working people better off.”

NOT JUST A TAX....