The latter makes sense. We also don't let steam engines and carts pay taxes just because they 'replace' (=displace) human labor.

Don't tax tools or income, tax the accumulation of it: wealth.

The problem is that rich people and large companies usually go to great lengths to avoid taxes, use loopholes or get special deals (and with great success). The missing tax income has to come from the middle class, who can't avoid it.

With increased automation, this only gets more extreme.

Relevant: Manna

https://marshallbrain.com/manna1

Directly taxing AI is very hard. Imagine if a company had to pay taxes for every AI agent operating in the U.S. or the E.U. As if they were regular employees. Big corporations would simply move the AI agents to countries without taxes.