# House Democrats Introduce AI Tax and Work Protection Act > Source: > Published: 2026-08-07 21:36:38+00:00 # House Democrats Introduce AI Tax and Work Protection Act House Democrats introduced the AI Tax and Work Protection Act on August 6, proposing an excise tax on covered AI businesses to fund a federal jobs program. H.R. 10044 would use the greater of a token-value calculation or an AI-service revenue calculation, with rates linked to unemployment. The proposal was referred to two House committees and has not been enacted. Rep. Greg Casar of Texas, Rep. Valerie Foushee of North Carolina, and Rep. Sara Jacobs of California introduced the **AI Tax and Work Protection Act**, H.R. 10044, on August 6. The bill would impose an excise tax on certain foundation-model businesses and direct the proceeds to a federal employment program. It was referred to the House Education and Workforce Committee and the Ways and Means Committee; it is a proposal, not current law. The introduced bill would calculate the tax using the greater of two amounts. The first is the fair market value of tokens processed in covered transactions multiplied by an unemployment-linked token percentage. The second is consideration received for AI services, plus the fair market value of certain related-party transactions, multiplied by a separate transaction percentage. The bill defines tokens broadly as units of text, code, image, audio, or video data processed by an AI model. When the applicable unemployment measure does not exceed 5%, the bill sets the token percentage at 2% and the transaction percentage at 3%. Both rise under formulas tied to higher unemployment. The measure would generally apply to covered transactions beginning one year after enactment, if Congress passes it and it becomes law. ### A proposed Work Protection Administration H.R. 10044 would place tax proceeds in a Treasury trust fund and establish a Work Protection Administration within the Labor Department. That office would award competitive grants to eligible governments, educational institutions, nonprofits, labor organizations, and other defined entities to create jobs. The bill lists supported areas including child care and early education, public education, health programs, elder care and disability services, housing, infrastructure, environmental projects, and local news and journalism. Grant-funded jobs would carry wage, health-insurance, paid-family-leave, paid-leave, labor-rights, and nondisplacement requirements. The program would prioritize permanent full-time positions and consider Bureau of Labor Statistics evidence about AI's labor-market effects. Casar's office framed the proposal as preparation for possible mass displacement and argued that companies benefiting from automation should help fund replacement employment. NBC News reported that Casar drew inspiration from the New Deal-era Works Progress Administration. Reason disputed the premise that AI has already produced mass unemployment, illustrating the political disagreement over whether such a tax is warranted before economy-wide displacement is established. ### Why the tax design matters to AI operators For AI-platform and ML-finance teams, the proposal makes measurement part of tax policy. A token-based calculation would require consistent valuation and auditable usage records across APIs and deployments, while the transaction calculation would require revenue and related-party attribution. The bill delegates further guidance, including token valuation, to the Treasury Department in consultation with the Commerce Department. Those requirements are not compliance obligations today. They are an introduced legislative model showing how Congress could connect AI usage, service revenue, and labor-market indicators in a future fiscal regime. ## Key Points - 1H.R. 10044 would tax covered foundation-model businesses using the greater of a token-value calculation or an AI-service transaction calculation, with rates tied to unemployment. - 2The proposal would create a Labor Department Work Protection Administration to fund jobs in care, education, health, housing, infrastructure, environmental work, and local journalism. - 3The bill was introduced and referred to two House committees; it has not been enacted, so its metering and revenue-attribution rules are a policy model rather than a current compliance obligation. ## Scoring Rationale The introduced bill proposes an unusual excise-tax framework that uses foundation-model token value and AI-service transactions as competing tax bases, then links rates to unemployment. It is not law, but its measurement and worker-program design is relevant to AI providers, finance teams, and labor-policy debates. ## Sources Primary source and supporting public references used for this report. Practice interview problems based on real data 1,625 SQL & Python problems across 15 industry datasets — the exact type of data you work with. [Try 250 free problems](/problems)