Impose ‘robot tax’ for AI-induced job loss, RSS-linked Swadeshi Jagran Manch tells FM ahead of budget

A ‘robot tax’ to cross-subsidise employees who lose jobs because of the adoption of Artificial Intelligence (AI) by their employers is a key item on the budget wishlist of the Swadeshi Jagran Manch (SJM), which is affiliated with the Rashtriya Swayamsevak Sangh (RSS).

In a pre-Budget meeting of economists with Finance Minister Nirmala Sitharaman last month, the SJM also suggested that tax incentives be given to industries generating more employment, based on an employment-output ratio.

Fund to upskill workers

Ashwani Mahajan, economist and national co-convenor of the SJM, who attended the June 20 meeting told The Hindu that economic measures were needed to cope with the human cost of AI. “We are not against the adoption of cutting-edge technology including AI, but it is a fact that in the short run, this will lead to loss of employment among certain sections of employees, and a ‘robot tax’, as it’s being termed, can be used for creating a fund that would help these workers upskill and adapt to new technologies,” he said, adding that such a tax is under consideration in several other countries as AI-generated disruption is hitting most economies.

A paper released by the International Monetary Fund (IMF) in June also argues that the AI transition will require fiscal incentives and stronger social nets being put in place, for all economies. Last year, Prime Minister Narendra Modi had cautioned people about the perils of misinformation and fake news with regard to AI, but the question of people falling out of the job market and being replaced by robots is a real worry.

‘Incentivise job creation’

Apart from the ‘robot tax’, some concerns raised during the recent parliamentary poll campaign are also reflected in the SJM’s wishlist. With unemployment being a major theme during the campaign, the SJM has suggested that industries be incentivised to create more jobs through tax measures.

With regard to food inflation, SJM proposed that small farmers be given subsidies for micro irrigation projects that they can start on their lands to increase productivity. It also recommended that these micro irrigation projects be made eligible for funding via corporate social responsibility (CSR), by adding them to Schedule VII of the Companies Act, 2013.

Wealth tax

On the issue of housing for all, the SJM suggested that a wealth tax be imposed on those holding “vacant land”, in order to “discourage unneccessary land holding on the pretext of future requirements”.

Ms. Sitharaman and Prime Minister Narendra Modi have been speaking to a range of stakeholders and economists in the run-up to the presentation of the Union Budget, which is expected to take place on July 23. The Budget session of Parliament will begin on July 22 and is expected to end on August 12.