Senator Amy Klobuchar floats idea of taxing companies that profit from user data

Senator Amy Klobuchar floats idea of taxing companies that profit from user data 1
The big picture: In an interview at the SXSW conference, Minnesota Senator and 2020 presidential candidate Amy Klobuchar discussed the idea of taxing companies that make money off user data. This wasn’t an official statement of policy, but it’s still an interesting talking point that could disrupt much of the tech industry if implemented.

Klobuchar views user data as a public resource like roads and has considered taxing them in a similar way. She summarized the idea as follows:

[Tech companies] use us, and we’re their commodity, and we’re not getting anything out of it. When they sell our data to someone else, well, maybe they’re going to have to tell us so we can put some kind of a tax on it […] If you go on a truck, if you send stuff on rail, you have to pay for the roads and you have to pay for the rail. And maybe there’s some way we can do that with large sets of data, when [companies] use it or when they sell it.

While this may seem like a simple way to tax the huge tech companies that often pay little to no taxes, implementing it may prove difficult. Details like what qualifies as user data, under what scenarios it should be taxed, and which companies would be subject to this tax would all have to be worked out. Additionally, some of the companies profiting off user data don’t necessarily do things ethically or at least transparently, so it may be difficult to keep tabs on everyone involved.

Klobuchar agreed that this type of tax may hinder data-science based startups, so she believes a tax like this should only apply to “larger platforms, not startups.” This type of tax has been proposed previously in Europe, but didn’t gain enough traction to be passed.

While Klobuchar is the first candidate to discuss a tax like this, other candidates have also voiced support for regulating tech companies. Senator Warren has talked about breaking up major tech companies that run ubiquitous platforms (Google, Apple, Amazon, others) to promote fair competition between third parties and the platform owners who possess all the data about users and purchases, which gives them a privileged position on decision making.

Regardless of which candidate gets the nomination, it’s clear that tech policy and consumer privacy will be a major part of the 2020 election.

Lead Photo Credit: Jack Plunkett

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