I don't see how that would work.
Let's say someone build a free software that automates the job of 100 million people. Surely, this would contribute to massive unemployment. Who should pay taxes, and how much?
If my employer replaces me with a robot, and nothing else changes, then my employer saves the cost of my wages minus the cost of the robot. I'm worse off, the robot manufacturer is better off, my employer is much better off, but society as a whole is worse off as it now has less tax income but one more unemployed person to support. Gates' suggestion means that I'd still be worse off, the robot manufacturer would still be better off, my employer would still be better off (but slightly less so), but society wouldn't be as worse off because tax revenue stays the same which (theoretically) covers the cost of my unemployment. Everyone wins (except me).
In the case of "Let's say someone build a free software that automates the job of 100 million people.", why should employers who replace people with said software get the benefit of the software and also reduce their contribution to society? Why can't they 'just' get the benefit of the software?
If you don't get it exactly right, and new companies are at an advantage, old companies will be replaced by new ones. If, on the other end, new companies are at a disadvantage, you risk stagnation.
Essentially, as I understand it, Bill Gates was suggesting we need to move away from taxing people because the number of people employed in a company is going to fall away to somewhere close to zero. Instead, if we want to raise taxes, we need to move towards taxing something else - that could be work done, or revenue, or transactions between companies, or electricity used, or CPU time.
Bill Gates isn't wrong. If we continue to link taxation to people as we always have then we will end up with tax revenues that don't even begin to cover the costs of running a functional society.
- 101 employees work there
- Super software is released
- Super software replaces 100 employees
- Company A pays taxes for the 100 replaced employees
- 1 employee work there
- Super software is released
- Super software replaces 0 employees
- Company B pays taxes for the 0 replaced employees
- Company A used humans for transcription. It now uses software.
- Company B never used humans for transcription. It always used software.