From EUobserver · · 1m 10s
EU taxes AI workers to fund pensions
EU must tax AI profits to keep funding pensions as jobs vanish.
In brief
EU must tax AI profits to keep funding pensions as jobs vanish. The EU will tax AI companies' profits to replace lost payroll taxes as automation reduces workers. Originally reported by EUobserver.
AI shifts work to machines
AI replaces human work with software and machines, eating away at the EU's tax base.
EU's tax system at risk
Taxes on work make up 51.5 percent of EU-27 tax revenue, rising in 2024 as AI reduces workers.
AI threatens pension funds
The IMF estimates 40 percent of global jobs are exposed to AI, risking fewer payslips and pension contributions.
Shift tax burden to profits
The EU plans to shift more tax burden onto corporate profits as AI replaces workers with machines.
Profit shifting risks
Companies move profits to low-tax jurisdictions, a pattern Europe has seen with firms in Ireland and Luxembourg.
OECD framework for AI taxes
The OECD's two-pillar framework targets AI firms with a 15 percent global minimum tax on large corporations.
EU's tax reforms face US pressure
US trade pressure has led to exemptions for US-parented groups from EU tax rules, weakening the framework.
Here's the gist
The EU will tax AI companies' profits to replace lost payroll taxes as automation reduces workers.
