This week, Assaf Harpaz (Georgia, Google Scholar) reviews a new work by Jeremy Bearer-Friend and Sarah Polcz, Sharing the Algorithm: The Tax Solution to Generative AI, 17 Colum. J. Tax L. __ (forthcoming 2025).

The rapid integration of Artificial Intelligence (AI) threatens to destabilize labor patterns and develop market monopolies with extreme concentrations of wealth. Can tax policy comprise part of the solution to AI’s many harms? In a thought-provoking new paper, Jeremy Bearer-Friend and Sarah Polcz propose a one-time “AI Tax” on generative AI firms in the form of equity remittance, allowing the public to own a share of AI.

The article begins by highlighting four well-documented harms caused by AI: stolen AI training material; mass unemployment; algorithmic bias; and radical market concentration. The authors argue that many previously proposed, targeted measures to address these harms do not suffice. For example, proposals to implement a collective compulsory licensing regime for AI training data and outputs would only provide partial relief that would be extremely complex and difficult to enforce.

The article proceeds to analyze the intersection of tax policy and AI. It largely divides prior proposals into those related to income taxes, excise taxes, and head taxes, including a brief discussion of robot taxes and digital services taxes (DSTs), concluding that these proposals are ineffective at addressing many of AI’s harms. The authors might consider expanding the discussion of individual and corporate income taxation in the context of AI, perhaps contrasting other proposals with their own contribution.

The article then proposes an “AI Tax” as a response to the harms of generative AI. The proposal would require the remittance of an equity interest from designated “AI Firms.” The main target of the AI Tax would be firms with ownership of a specific type of AI (presumably generative AI). There are several ways in which AI Firm equity could be remitted, like requiring firms to remit equity proportional to their outstanding securities or placing AI ownership interests into a designated entity and remitting a portion of that entity’s equity. The authors stipulate that the AI Tax should be a one-time tax, but that firms that become designated AI Firms in later tax years will also be liable for its remittance. Furthermore, the authors suggest that shares could be distributed directly to the eligible public or be held by a publicly managed fund.

The proposal is fundamentally grounded on the relationship between the tax system and distributive justice, and the tax system’s longstanding use as a tool for regulating taxpayer behavior. In addition, the authors justify the imposition of the AI Tax on the concept of the “digital public,” subject to which firms derive value from the everyday creators and users interacting in the online environment, whose thoughts and communications have fueled the rise of generative AI. The authors acknowledge the limitations of their proposal, noting that any effort to tax AI is ultimately a political decision, including the choice of tax rate. While the authors recognize the ambiguities in defining “AI” and “AI Firm,” they may consider elaborating on who they believe would be eligible firms and beneficiaries, and whether an AI Tax risks straining U.S. competitiveness and innovation if implemented unilaterally.

In summary, the article is an insightful contribution to one of the most pressing issues in tax policy. The authors set forth an original proposal that expands the role of public voice in AI firm governance, demonstrating how tax policy can help mitigate some of the immediate and long-term threats of AI.

Here’s the rest of this week’s SSRN Tax Roundup:

Violeta Ruiz Almendral (Universidad Carlos III de Madrid), EATLP Congress 2024 “Taxation and Inequalities” – Spain National Report, Taxation and Inequalities (October 25, 2025)

Vorris J. Blankenship (Independent), Final Regulations Under The SECURE Act, Tax Notes Federal, Vol. 189, No. 2, pp. 277–313 (October 27, 2025)

Conor Clarke (Washington University in St. Louis – School of Law), Jon Endean (Brooklyn Law School), Ari Glogower (Northwestern Pritzker School of Law), & Daniel J. Hemel (New York University School of Law), Brief for Tax Law Professors as Amici Curiae in Support of Petitioners in Learning Resources (No. 24-1287) and Respondents in V.O.S. Selections (No. 25-250) (October 27, 2025)

Brian Connolly (Independent) & Arthur C. Nelson (University of Arizona), Building Social Equity through Value (October 18, 2025)

Bridget J. Crawford (Pace University – School of Law), How the ABA Resolved to End the Tampon Tax (October 23, 2025)

Eivind Furuseth (Independent) & Jinyan Li (York University – Osgoode Hall Law School), Improper Use of Tax Treaties and Source Taxation: Policy, Practice and Beyond (October 21, 2025)

Ignacio Adrian Lerer (Independent), Argentina’s Fiscal Lock-in: Tax Reform as Extended Phenotype (October 23, 2025)

David S. Miller (Proskauer Rose LLP), Apportioning the Billionaires Income Tax (October 25, 2025)

Susan C. Morse (University of Texas at Austin – School of Law), Shu-Yi Oei (Duke University School of Law) & Diane M. Ring (Boston College Law School), The Origination Clause and the President’s Tariffs, 103 Wash. U. L. Rev. __ (forthcoming 2026); U. of Texas Law, Legal Studies Research Paper (October 21, 2025)

Comrade Kalu Nnanna Nwonyuku (Federal Inland Revenue Service), Balancing Investment Promotion and Fiscal Responsibility: An Analysis of Nigeria’s Economic Development Tax Incentive (EDTI) (October 20, 2025)

Michal Radvan (Masaryk University – Faculty of Law) & Taisiia Chepys (Masaryk University), Wealth Tax as a Tool to Increase Tax Revenues in Polycrisis Times (October 27, 2025)

Ganesh Rajgopalan (Independent), Treaty Entitlement, Principal Purpose Test, and GAAR-Select Issues (October 19, 2025)

Eric Smith (Independent), Abortion and State Taxes: Unexpected Parallelism, forthcoming, Oklahoma Law Review (October 23, 2025)

Alexandra Walker (Independent), The Durability of Tax Laws and Their Objectives (October 28, 2025)

Matt Zwolinski (University of San Diego), Capital Punishment: Why a Wealth Tax Won’t Work, and What to Do Instead, forthcoming in Intertax (2026) (October 28, 2025)