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Automation of work, the enemy of employment? “An idea very often conveyed, but which is false”

  • Post category:Economy News
  • Reading time:3 mins read

For the professor of digital economy at the Brussels Solvay School, this is the real question that must be asked. How can we ensure that our tax model adapts to this new reality? “The new reality is that, in fact, the share of employment, that is to say wages in national wealth, has been declining in all developed countries for about thirty or forty years now. years, whereas it is a value that is normally extremely stable historically.”

This observation is extremely worrying on two counts, he explains. “Firstly because it means that effectively value is more and more the result of machines and therefore of capital, let’s say, and less and less the result of labor. Probably because humans, more and more, are in roles of controlling what machines do rather than real productions“This poses a huge tax challenge”because all our taxation was based on labor and very, very little on capital.”

For Nicolas van Zeebroeck, the real challenge of tomorrow’s taxation is to determine how to shift taxation more from labor to capital “which is not at all enough taxed access with us.” The idea would be to tax the income produced by the machine, and even better than the income, it is the profits taxed by the machine, he explains.

What is risky is actually taxing a tool regardless of its use and the value it creates. However, Comeos (the federation that represents supermarkets, editor’s note) there is a point when they say that they are a sector in which net profit margins are quite low, we are at 2 or 3% margin on average in large retailers. So in our sector of activity, we are at 20, 25 or 30%. And so, if the challenge is to find money where there is some, as Catherine Moureaux said, let’s go find it in the sectors that really make very large margins and where it makes sense to tax capital gains.”

This specialist would prefer: “that we tax capital gains, that is to say the flow, the value that machines generate, rather than taxing the machine itself, which is more of a brake on innovation“And he gives the example of the only country that has really done it on a large scale which is South Korea.”South Korea really did it explicitly as a way to slow down innovation. For them, innovation is going a little too fast and so they said to themselves, we are going to put a tax on robots because we are going to slow down, we are going to slow down innovation.’

The sector represents only 2 or 3% of the market. But if we taxed the machines for another sector, perhaps more financial, there, would it work better? Yes and no, believes Nicolas van Zeebroeck, “because again, the question is what do we want to tax? Do we want to tax again, just an asset or do we want to tax income?