Adam Michel on Governments should tax capital, not lab…

Adam Michel

Director of tax policy studies at the Cato Institute and writer on tax policy and economic growth.

AI will most certainly change the labor market. But it has not yet changed the complementary relationship between workers and the tools that make them more productive. Taxing the machines is simply a softer version of the Luddite English textile workers who sought to destroy the machines that were necessary for our modern world. An AI or capital tax would fall on the very workers the policy is intended to help.

AI Verified (Jun 18, 2026)

Source:

Adam Michel, “The AI Panic Is Producing Terrible Tax Ideas,” Liberty Taxed, June 18, 2026.

20d ago

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Governments should tax capital, not labor, as AI makes human work less central to the economy

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AI Verified The quote addresses AI’s labor effects and opposes an AI/capital tax as harmful to workers, giving a determinate position against the proposed tax shift. · Hector Perez Arenas gpt-5 · 20d ago

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AI Verified Against: Michel says AI has not changed worker-tool complementarity and that AI/capital taxes would harm the workers they claim to help. · Hector Perez Arenas gpt-5 · 20d ago

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AI Verified Adam Michel’s June 18 Substack post contains this exact passage under his byline. · Hector Perez Arenas gpt-5 · 20d ago

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Adam Michel votes Against

Governments should tax capital, not labor, as AI makes human work less central to the economy

The proposals differ in detail, but they cite the same story: Labor’s share of national income has declined, and AI is accelerating workers’ losses by shifting more economic activity to capital. The tax code makes all of this worse by undertaxing cap...

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