Cognizant CEO Proposes Taxing AI to Level Playing Field with Human Labor

The CEO of one of the world's largest IT services firms is making an unconventional argument: artificial intelligence that replaces human workers should be taxed like the people it displaces.

Ravi Kumar S, who leads Cognizant's 350,000-person global workforce, told TIME's CEO Moment series that the tax proposal hinges on how companies deploy AI. If organizations use the technology to eliminate jobs rather than enhance human capabilities, he believes digital labor should carry the same overhead costs as human labor.

"I'm actually saying if you are positioning this technology to eliminate human work, and you are not positioning this technology to amplify human work, labor is getting taxed," Kumar said. "Why should human labor be getting taxed? Why shouldn't digital labor be carrying the same overhead?"

Why it matters

As enterprises race to adopt AI, the debate over who bears the economic burden of automation is moving from academic circles to corporate boardrooms. Kumar's position is particularly notable because Cognizant both sells AI services to clients and must manage its own workforce transformation—giving him direct exposure to the technology's employment impact on both sides of the equation.

Navigating workforce transformation

Kumar's comments come as Cognizant manages significant workforce changes. The company recently celebrated hiring 20,000 entry-level graduates while simultaneously announcing $270 million in severance spending. Kumar maintained that the company's net headcount remains positive and continues growing, though he did not specify how many positions were eliminated due to AI adoption.

The CEO, who took the helm in January 2023, envisions AI fundamentally reshaping organizational structures. He predicts companies will shift toward smaller, more agile teams with managers serving as "player-coaches" who work more hands-on. The traditional advantage institutions held over individuals through accumulated expertise will erode as AI puts knowledge at everyone's fingertips, Kumar argued. Instead, interdisciplinary skills will become the key differentiator.

The AI bubble question

When asked whether the current AI investment frenzy constitutes a bubble, Kumar expressed measured skepticism. While he's convinced the underlying capability exists, he questions whether the technology is delivering sufficient production value.

"If you see this buildout, and if it is real, money will flow into the bridges. Money will flow into the end user industries and the end user industries will benefit out of it," he said. "If that flow is not happening, then this bubble is going to burst."

Rethinking education for an AI era

Kumar also called for major changes in how schools prepare students for an AI-enabled workplace. He noted an absurd contradiction: students face expulsion for using AI in school, while employees risk termination for not using it at work.

His proposed solution: teach core skills without AI in the classroom, then assign homework that requires AI tools. This approach, he argues, would build both fundamental capabilities and practical AI fluency.

The CEO also emphasized the continued importance of immigration to American innovation, warning that restricting access to global talent could undermine the country's competitive advantage in creating innovation ecosystems.

The details were first reported by TIME in its CEO Moment interview series.