If Artificial Intelligence, What About Tax?

Welcome to Netopia, where technology meets society.

In Philip K Dick’s 1968 sci-fi novel Do Androids Dream of Electric Sheep the protagonist Deckard fails at his job to identify “replicants”, human-like robots, instead falling in love with one. You may recall Harrison Ford and Sean Young in Ridley Scott’s 1982 film version Bladerunner. The story is inspired by British mathematician Alan Turing’s idea that if an artificial intelligence can convince a real person that it is human, it will be as smart as a human. Real, human-like artificial intelligence.

The other week, the presumably required 33% of a panel of judges in London deemed the chat-AI Eugene Goostman to be human, thus passing the Turing test. Of course there has been no shortage of criticism of the method and no-one really believes that computers are smarter than people. Yet. But they may well be, one day, provided the exponential growth in computing power known as Moore’s Law continues.

Manual labour has to a large extent been replaced by machines, exchanging salary expenses for capital investment on many corporate books. With human-level AI – actually, long before – intellectual labour will also be possible to replace with machines, not necessarily robots as we know them, but algorithms. Software. Believers say new (and better) jobs will come, not to worry. Economists say that there may be transition problems that increase with the speed of change. But government ought to worry about tax. The industrialised world’s tax system relies on taxes on labour. If AI and algorithmisation happens, that would need to shift to tax on capital and consumption. Not an easy sell in a Europe still recovering from the crisis.

When faced with the EUCJ-ruling on the “right to be forgotten”, Google’s Larry Page said it could help repressive governments and damage innovation. For sure those dictators use digital technology for oppression just as much as democracy activists can use them for change. And it is difficult to understand why start-ups should play by different rules than others. However, there is a deeper questions here: is everything online “speech”? Are banking services speech? Maps? Search, self-driving cars, auctions, mail order, spam filters… if everything online is speech, real speech is diluted. Freedom of speech should be reserved for the right to express one’s own views without censorship or prosecution. All the rest needs a finer set of rights and responsibilities. Freedom online will be a focus for Netopia in a near future. Watch this space!

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Footnote: this is Netopia’s newsletter the week of June 30th.