Tax Notes Talk Taxing Generative AI: The Future of Tax Policy and Tech
Feb 13, 2026
Sarah Polcz, a law professor studying technology and policy, and Jeremy Bearer-Friend, a tax policy scholar, propose taxing generative AI firms via equity remittance to create partial public ownership. They discuss why tax can address societal harms, how an equity-paid tax could work, definitional and governance choices, historical precedents, and political and legal roadblocks.
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AI Normalizes And Amplifies Bias
- AI amplifies historical prejudices, producing measurable discrimination in hiring, lending, and policing.
- Normalization of biased outputs risks eroding civil-rights gains across civic life.
Combine Tax With Regulation
- Use tax as one tool among regulations to address AI harms rather than the sole intervention.
- Leverage tax's redistributive and regulatory roles to share gains and influence governance in AI firms.
Tax Paid In Equity Not Cash
- The proposed tax is paid in equity: firms remit a percentage ownership interest to the public rather than cash.
- Equity remittance leverages existing corporate practices and avoids difficult firm valuation problems.