Democratic Sen. Elizabeth Warren calls for taxing AI

Sen. Elizabeth Warren, D-Mass., is advocating for targeting the artificial intelligence industry with taxes.

“It’s time to tax AI and invest in people,” the left-wing lawmaker has asserted.

She has floated the prospect of taxing the energy consumed by AI data centers.

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Sen. Elizabeth Warren, D-Mass., ranking member of Senate Banking, Housing, and Urban Affairs Committee, speaks during a hearing in Washington, D.C., on Thursday, Feb. 5, 2026.  (Kent Nishimura/Bloomberg via Getty Images / Getty Images)

“Rethinking our tax code must also include going to the source: that means taxing AI companies directly, which can start with taxing AI data centers,” she wrote in an opinion piece posted by Time. “By imposing a reasonable excise tax on the energy used by data centers, families could recoup some of the gains of AI, while America continues to stay competitive in the AI race. A well-designed tax would focus on the companies that can afford it and scale with AI’s impact: the bigger the data center, the more they pay.”

“We can’t be afraid to consider even bigger and bolder proposals to tax AI too, including ideas that sound radical today but may quickly become common sense,” she asserted in the piece.

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The senator claimed that the tax system incentivizes replacing workers with AI.

“Right now, companies pay payroll taxes for their workers but get tax breaks for investing in technology—effectively, a tax penalty for hiring human beings and a tax break for buying equipment. In an AI world, that means our tax code is incentivizing corporations to fire people and replace them with AI. That’s wrong. We need to level the playing field by raising taxes on corporations and capital gains and closing corporate loopholes,” she wrote.

Warren also called for a “wealth tax” on affluent individuals.

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Sen. Elizabeth Warren, D-Mass., speaks during the Borrowers Not Billionaires Rally To Defend the CFPB (Consumer Financial Protection Bureau) at Capitol Hill on Feb. 9, 2026 in Washington, D.C. (Jemal Countess/Getty Images for Protect Borrowers / Getty Images)

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“AI billionaires are running the same playbook: get rich off massive stock valuations and avoid paying the taxes that would be owed if those funds were earned as salary. If it wasn’t clear before, there’s no question in a world of AI: we need a wealth tax,” she asserted in the Time piece.