AI Economy Tax Model
What tax rate on AI companies maintains living standards as automation displaces workers? Adjust inputs to explore scenarios.
Displacement
White Collar96M workers
30%Blue Collar64M workers
15%UBI per Worker
$40,000AI Economy
AI Company Revenue
$2.0TValue Capture Ratioshare of total AI economic value that shows up as AI company revenue
25%AI creates value beyond what AI companies bill for — productivity gains, consumer surplus, etc. At 25%, if AI companies earn $2.00T in revenue, total AI-generated economic value is $8.00T.
Deficit
Deficit Coverageof $1.8T deficit
0%Scenario Summary
Displaced Workers
38.4M
Total AI Value
$8.00T
Lost Tax Revenue
$600.0B
UBI Cost
$1.54T
Required Tax Rates on AI Company Revenue
Layer 1 — UBI Only
77%$1.54T needed
Layer 2 — UBI + Lost Tax Revenue
107%$2.14T needed
Layer 3 — UBI + Lost Tax + Deficit Coverage
107%$2.14T needed
Layer 4 — Rate on All AI-Generated Value
27%$2.14T needed
⚠ Sanity Checks
Rate of 107% on AI revenue likely exceeds profit margins, making it economically unviable on revenue alone.
Required rate exceeds 100% of AI company revenue — this scenario cannot be funded by AI company taxation alone.
Baked-In Assumptions
Labor force: 160M (60% white collar, 40% blue collar)
Federal income + payroll tax: $2.5T/yr
Avg effective tax rate: 25%
Existing deficit: $1.8T/yr
Federal income + payroll tax: $2.5T/yr
Avg effective tax rate: 25%
Existing deficit: $1.8T/yr