In a recent discussion about automation and technology, Bill Gates shared his thoughts about shifting from the current structure of taxing individual payroll to taxing individual consumptions.
With technological advances moving at a fast pace, the demand for jobs might reduce with automation. Speaking about automation, Bill Gates said that at this stage, we should start thinking about preparing for the future where Robots and software’s would have replaced the current workforce. As quoted by Bill Gates:
Technology over time will reduce demand for jobs, particularly at the lower end of skill set… 20 years from now, labour demand for lots of skill sets will be substantially lower. I don’t think people have that in their mental model.
It’s predicted that in a few years from now, Robots might eat up a huge chunk of people jobs both in the low and high skilled sectors which could drastically affect the currently employed population. At that point in time, we might require the elimination of Payroll and amend the corporate tax amongst various other changes. But what about the workforce which might become jobless?
Currently, the tax is one of the major revenue generators which in turn contributes to every country’s economy. Now visualize a scenario, wherein Robots have replaced the existing workforce, then who will government ask for paying the taxes. Robots? Think Again.
And in the absence of tax collection, the cash crunch will arise which will affect the evolution of software and automation technologies as a part of the same revenue collected from taxes which is pumped in researching on next generation technologies.
In order to be prepared for such an environment, both organizations and government should initiate a formulation of a framework which ideally will ensure or take care of the wellbeing of these individuals who will eventually be replaced by automated robots in different sectors
The world of automation could be full of its benefits but also poses a scary situation ahead for which governments should be well prepared for. This should ideally be a well-planned long-term plan!