Comment by Elena Patel

Whether the goal is to protect workers or improve the fiscal outlook, shoring up the taxation of capital income, where much of AI’s gains are likely to accrue, would likely be more effective than a new tax that singles out AI. [...] AI may displace workers on a large scale as well as the labor income on which our existing tax system relies. [...] AI’s gains are likely to keep flowing disproportionately to capital, income that’s already taxed more lightly than labor. Closing that gap would likely do more for the fiscal outlook than a narrow tax on AI and help fund responses to its costs.