The Feasibility of Adopting Robot Tax in Developing Countries: An Analysis from a Vietnamese Perspective

The Fourth Industrial Revolution is dramatically generating social, political, cultural, and economic changes in our lives. While technological advancement undoubtedly enhances living standards, it also raises several socioeconomic problems. Remarkably, automation and artificial intelligence (AI) are reconstructing business models and reshaping the future of work. On the one hand, these emerging technologies are boosting productivity to an unprecedented level. On the other hand, robots are threatening to replace human workers, potentially leading to massive job loss and exacerbating income inequality. In response to these challenges, some scholars suggest adopting a robot tax, an initiative to discourage the use of automation to replace human workers and strengthen the social safety net (SSN) for displaced individuals. In this paper, the authors assess its feasibility by examining principal arguments for and against robot tax. Remarkably, the authors evaluate these arguments in the socioeconomic context of Vietnam, a labor-abundant developing country heavily relying on labor-intensive industries but still striving for technological innovations. The authors then contribute suggestions for the Vietnamese tax system to address challenges brought about by emerging AI technologies.