Reed Recruitment CEO: Back Humans, Tax Robots

(Episode 46) Britain should stop taxing workers and start taxing robots, according to the chief executive of one of the country's biggest recruitment firms, who says the UK's tax system is pointing in entirely the wrong direction at the worst possible moment.

James Reed, CEO of Reed Recruitment, told the Big Boss Interview that the government is taxing employers who hire young people "to pick up beer glasses in gardens" whilst letting AI and automation — the technologies actively replacing those workers — go entirely untaxed. His mantra: "Back humans, tax robots." And he wants the next prime minister and chancellor to make it the centrepiece of a wholesale redesign of how Britain raises revenue.

Reed argues this is not a fringe idea but an inevitability. "Taxation follows wealth," he said. "When you see these companies being valued at over a trillion, that's where the action is. So that's where the taxation should follow." He envisions transaction-based levies on AI services and automation — "rather like VAT" — or surcharges on businesses that replace human workers with machines. He acknowledged it would "take some designing" but said the principle is simple: the robots are generating the wealth, so the robots should be taxed.

The urgency, he said, is driven by the collision of two forces. The first is the October 2024 budget, which Reed described as a "historic mistake." The £25 billion employers' National Insurance increase was, in his words, "a tax on jobs" that caused clients to cancel hiring within a week and has driven businesses towards automation and offshoring at precisely the moment AI makes both easier than ever.

The second force is AI itself. Reed warned it is "burning through entry-level jobs," destroying opportunities for young people at a pace the country is not prepared for. He said Britain is behaving like "rabbits looking into the headlights" of these changes, with no collective strategy for what happens when the jobs disappear — and with them, the income tax, employees' National Insurance and employers' National Insurance that fund public services.

Reed was unequivocal about the political response required. Asked whether there should be a new chancellor, he said: "Yes, absolutely. The incumbent made the decisions that caused the damage." He called the current period one of the toughest in his 30 years as chief executive, ranking alongside the financial crisis of 2008 and the early days of the pandemic — but worse in one respect. "In 200