Picture the scene…
Somewhere deep within the labyrinthine corridors of HMRC, there is a lone official clutching a lukewarm cuppa and staring mournfully at a whiteboard filled with scribbles like “robot income?” and “where does one even add a category for a circuit board on a tax return?”.
Because let’s face it, while companies are busy swapping human workers for robots where they can faster than you can say P60, the taxman has suddenly realised something rather worrying. You cannot strong arm a robot into paying National Insurance. You cannot threaten it with late payment penalties. You cannot even guilt trip it with a sternly worded letter in a brown envelope.
So the moment is coming. The question is not if, but when, the Treasury will decide that robots must “do their bit”.
And oh what a moment it will be. One can almost imagine the first consultation paper proudly announcing a bold modern vision of fairness. A brave new world in which companies are asked to declare exactly how many robots they employ, what hours they work and whether they take tea breaks. There will be a box asking if the robot receives any benefits in kind and another asking if it ever works from home. The answer to the last one will of course be no, because robots basically live at work, which will no doubt lead to the creation of a special surcharge. One can only guess at what happens if someone takes their laptop home and asks the AI for a recipe based on what they have left in the fridge.
Naturally business leaders will feign shock. They will say this is quite unexpected even though everyone could see it coming a mile off. Politicians will insist the measure ensures “a level playing field” which is Westminster code for “we are massively short on revenue and something has to give”. Meanwhile the public will be split. Half will cheer because finally those tireless metal workhorses will “pay their fair share”. The other half will roll their eyes and ask whether the toaster now needs to fill out a self assessment return.
Imagine payroll departments trying to explain to the PAYE software that Dave the forklift robot does not need holiday pay, but now attracts a “mechanical labour duty”. Human resources will have to rebrand themselves as “human and synthetic resources”. Someone will write a strongly worded complaint to the Times because their accountant has started asking whether Siri counts as a dependent or is subject to IR35. And somewhere in Birmingham a small business owner will be shouting into the void because the tax office has sent them a letter saying their robotic arm is apparently overdue for Class 1 contributions.
But truly the best part will be watching HMRC attempt enforcement. What do you do if a robot refuses to cooperate. Disable its updates? Confiscate its battery pack? Send it a warning email that will be interpreted literally, then acted upon at precisely midnight with terrifying robotic punctuality? Enforcement officers may need to carry screwdrivers just in case.
Still one cannot blame the Treasury for trying. When companies stop paying humans, the pot gets smaller and politicians get twitchy because they like having lights on in public buildings and a nice jolly to the Maldives to see how the government operates there. Someone has to plug the gap and it turns out that someone may well be a friendly neighbourhood manufacturing bot, who until now only wanted to weld in peace.
Of course companies will push back. They will hire expensive consultants who will insist that robots are not employees but “capital assets engaging in autonomous functional output”. They will argue that you cannot tax a robot because it does not have a National Insurance number and that applying for one would require a birth certificate which most robots sadly lack. Lawyers will gleefully dive into decades old case law about what counts as a person and whether the phrase “gainful employment” can apply to something that has never once complained about its manager.
And while all this unfolds British banter will thrive. The tabloids will inevitably run headlines about “Jobs stolen by the bots now taxes too”. Someone on Twitter will declare their fridge is a sovereign citizen and refuses all tax obligations. Pub conversations will become a blend of existential dread and jokes about accountants sending brown envelopes to Roomba.
Eventually a compromise will emerge because the Treasury always gets what the Treasury wants. There will be a neat formula that taxes not the robots themselves, but the companies that love them a bit too much. It will be pitched as sensible pragmatic and future proof which means it will be rewritten within eighteen months. Businesses will grumble but pay. Robots will continue to whirr away blissfully unaware. And HMRC will breathe a sigh of relief as the revenue graph flickers upward just enough for the Chancellor to sleep at night and sign off on another office party at the Ritz.
Until then, all we can do is sit back, watch the march of the machines and wait for the day the taxman launches his most ambitious scheme yet.
Not “Making Tax Digital” but “Making Tax Digitalised Workforce Compliant” which sounds like exactly the sort of thing Whitehall would say before everyone realises no one has the faintest clue how to actually make it work.
If nothing else, it will be marvellously British. Tea in hand, mild exasperation in voice and an unshakeable determination to keep collecting revenue even if you have to chase a robot down a factory corridor to do it.
