Entrepreneur and 2020 presidential candidate Andrew Yang speaks during a campaign stop at the train depot on February 1, 2019 in Jefferson, Iowa.

The proposed value-added tax would be a consumption levy placed on products sold in the U.S. Yang claims that because our "economy is now so massive at $20 trillion, a value-added tax at even half the European level generates $800 billion in new revenue."

"There's really no place for them to go," Yang said, noting that "every other advanced economy" already has a VAT that's higher than the one he's proposing.

Yang, who announced his candidacy in late 2017, is proposing a 10 percent VAT targeting companies like Amazon and Google. But he said he doesn't believe corporations would abandon the U.S. if they are hit with the tax.

Democratic presidential hopeful Andrew Yang doesn't believe his proposed value-added tax, or VAT, on companies in the United States would drive business out of the country, he told MSNBC 's "Morning Joe" on Monday.

Yang said the tax would help pay for his plan to give every American adult between the ages of 18 to 64 a monthly $1,000 stipend. Yang claims there is a need for a universal basic income as artificial intelligence threatens to put a third of Americans at risk of permanent unemployment.

Yang said those handouts would then boost the economy.

"This is the trickle-up economy, not the trickle-down economy," he said.

According to data from the Roosevelt Institute, a $1,000 handout per month to each adult citizen would grow the economy by $2.5 trillion in eight years.

Yang used Amazon as an example as to why the U.S. should enforce a value-added tax. He said Amazon, which is one of the most valuable public companies in the world, should not be paying $0 in taxes. This is the second year in a row the company has paid nothing in federal taxes.

"Is it Amazon's fault that they paid zero in taxes?" Yang said. "No, it's our fault."

Amazon noted in a recent company filing that it will pay $756 million in state and international taxes this year.

"Amazon pays all the taxes we are required to pay in the U.S. and every country where we operate, including paying $2.6 billion in corporate tax and reporting $3.4 billion in tax expense over the last three years," an Amazon spokesperson told CNBC Make It.

Yang said the United States is the No. 1 market in the world, and if companies want to sell their products here "they have to pay their fair share."