8 ms·

This really seems like a great idea! Anyone see any reason why it shouldn't be?

simonbw 10y ago
Patents and trademarks maybe, but copyright? You have copyright on basically anything you create. Should I pay taxes on everything I put on github? On essays I write? What if I'm a famous artist? If I make some artwork to go in my living room, should I really pay 1% of the assessed value of that every year? If I write a book, is it not enough to pay taxes on the income I get by selling my book? Should I really have to pay taxes on it to keep it out of the public domain?
- reitanqild 10y ago
  Thanks! I feel a little less smart now which is a good sign. :-)
- bostonvaulter2 10y ago
  Who said anything about copywright?
  - lordnacho 10y ago
    Copyright is a form of IP.
  - jahnu 10y ago
    > Intelectual Property (especially patents and copyrights)
- Aaargh20318 10y ago
  > If I write a book, is it not enough to pay taxes on the income I get by selling my book? If I rent out a house, is it not enough to pay taxes on the income I get from rent ? > Should I really have to pay taxes on it to keep it out of the public domain? Yes. If you build a house with your own two hands, should you not pay property tax on it ?
  - astrodust 10y ago
    A house takes up physical space. Intellectual property doesn't. The reason we have property taxes is because maintaining the environment around the house costs money. There's no roads and sewers and schools for books.
    - beagle3 10y ago
      there are a lot of costs involved with enforcing property rights. It's not sewers but it is legal departments, customs offices and law enforcement officers. Also, a patent takes space by disallowing me to use the same kind of invention (even if I came up with it independently). And a copyright sometimes stops me from being able to use a "cultural common". They most definitely take space. And real estate property taxes are often supplemented by "road maintenance levies". They don't directly support the property's infrastructure when you really look into it.
      - astrodust 10y ago
        Patents are a fairly large investment, plus they're a fixed life-span item. Although I'm largely against patents, fiddling with the fees associated with them won't help solve any problems. Now when it comes to copyright enforcement, 99.99% of the copyrighted material out there is never formally published. It's source code, it's email, it's creative works produced and shared but never curated or packaged. How can you possibly tax all of that?
        beagle3 10y ago
        If it's not published, its protection comes mostly from not being seen (in private setting) or from trade secrets and associated laws. If only want to use the tax as a way to make sure orphaned works can be shared, and patent trolls become unprofitable. I believe that an IP tax can help both. I think it is essential to force proper valuation of IP, and I think tying it to recovery (upside) and taxes (downside) is likely to give a proper evaluation. It is not my intention to try to tax your own painting on your living room. I assume, by default, anything not listed, is valued at $0 for that year. Do you understand that, regardless for copyrights or patents, your IP is not enforceable unless you can afford the court action?
- randomdata 10y ago
  It was suggested elsewhere that you would assess the value yourself, so if the only utility of your work is to hang it in your living room, you could claim it has $0 copyright value, and thus pay no tax. The implication is that if someone decides to copy it, your claim for damages in court is based on that $0. But if your intent is to keep a private copy in your living room without the willingness to share with the public who gave you the privilege of copyright in the first place, perhaps that still remains fair.
DKnoll 10y ago
Because it would make the misappropriation of the work of poor creators cheap.
- darawk 10y ago
  But if they had something worth keeping, they could ideally get financing from someone who'd want to own it. At least, that's what should happen in an efficient market.
  - totony 10y ago
    A poor person will have to sell his idea or else he wont be able to patent it. What was proposed may solve some problems, but if it deepens that inequality hole I dont think its worth it. If you own a unused property, in comparison, shows you have significant funds
    - beagle3 10y ago
      A poor person already has to sell it. Patents cost a minimum of $5,000, usually not less than $20,000 and often not less than $50,000 all things accounted for. That's just filing - it can take upwards of 5 years to get approved or rejected. And then, it is STILL worth nothing because you have to sue to enforce infringement, at costs north of $100,000 more often than not. I propose that the value of IP for tax purposes is owner assigned. If you have no money to pay the tax, just declare $1. The catch is, that would make you ineligible to recover much more than that in the case of infringement. As far as poor people, it changes little to none. But it grounds patent valuation, which are now arbitrary.
      - will_brown 10y ago
        There are a few fundamental flaws with your proposal, but namely the inventor of a patent or holder of IP generally does not just randomly assign a value to their IP and win that amount in the instance of infringement. It's sort of the whole point of proving damages, because it would be impossible to calculate future damages for a violation of IP at the time the IP was created. For example I invent and patent the widget and assign a $1B valuation to the invention. Apple violated my patent, manufactures the widget and sells $100M. Should I sue, my potential damages have nothing to do with the $1B valuation I made up but with the damages I suffered as a result of Apple violating my patent. Alternatively I write a book and slap $1 valuation, because I assume there is no market for my writing or to avoid the big tax until I make it big. JK Rowling Violated my copyright and slaps her name on my book and sells millions of copies, again my damages have zero relation to the valuation I created for the IP.
hengheng 10y ago
Valuation of IP is not easy. Even if you invest a lot of effort, there will be some big error bars.
- beagle3 10y ago
  Of course. But they will still be about a hundred times smaller than they are today. Today, someone thinks of an idea, patents it and estimates its worth at $100M. Someone else develops the same idea and assigns a value of $20K. That's the error bar TODAY. Inventor has no incentive for realistic estimate - they will always overestimate (no penalty for that). An infringer has no incentive for a realistic estimate (no additional penalty for that if he loses in court). An ip tax will decrease the error bars by forcing the patent owner to pay for overestimates.
- Aaargh20318 10y ago
  That is the whole point. Either you agree that IP is real property and as such it should be taxed, or you don't and and you pay no taxes. If your property has value, then you should pay property tax. If it has no value, you cannot claim damages if someone 'steals' said property since it wasn't worth anything. You can't have your cake and eat it. If you start taxing imaginary property, this will force IP owners to consider wether their IP has actual value or not and act accordingly.
will_brown 10y ago
Because creating an acurate valuation for IP at the time IP is created that would be accurate for the life of the IP is impossible. Moreover, it would make no sense for that made up valuation for tax purposes to determine future potential damages in IP infringement cases. Edit: to bring the concept to perspective, imagine having to assign a valuation to new borns so in the instance they die as a result of negligence the damages are capped at the assigned valuation of the deceased at their birth.
- ianai 10y ago
  Values are placed on people's lives all the time for insurance. I'm thinking for IP a flat tax may make most sense. It would incentivize letting go of at least some things. If it's $5 fewer things will go public than if it's $1000, for instance. It should probably be more to actually affect companies.
- beagle3 10y ago
  I didn't explicitly state this here (I did numerous times before when discussing this) but property tax is annual, and I propose value assignment be annual as well. Therefore, if at the end of the year neither yourself nor anyone else had made any money from your IP, just assign zero. At the moment, patents are cheap compared to the value they have as an offensive weapon, and this is what I hope to address with my proposal. As for copyrights - the same framework would make infinite extension unaffordable even for Disney, so I hope we would all benefit.
  - pakitan 10y ago
    You can only determine the exact IP revenue when someone is paying explicitly for the use of that IP. If, however, I'm selling, say, a very complex machine, where I hold a patent over a small component of that machine, how would you determine the value of my patent? > Therefore, if at the end of the year neither yourself nor anyone else had made any money from your IP, just assign zero How would that solve the issue of patents being used as a offensive weapon? Under your proposal if a patent troll has thousands of patents and has made zero revenue on them, they would pay zero tax. On the other hand if they made money, they will happily pay the tax.
mseebach 10y ago
So, capping damages at the listed value of the patent basically means that you have a standing offer to sell a perpetual non-exclusive license to any one for any reason. This means that for anything truly valuable (say, medicine), the value would probably have to be assessed in the several billions. Medicine can take tens of years to commercialise, so we've just raised the cost of developing new medicine substantially. So, rather, it would probably discourage patenting these things (in favour of keeping them deeply confidential) until their value has actually been proven, which goes against the purpose of the patent system in the first place, to encourage the disclosure of inventions in exchange for a monopoly on exploiting it.
- beagle3 10y ago
  > So, capping damages at the listed value of the patent basically means that you have a standing offer to sell a perpetual non-exclusive license to any one for any reason. Yes. At full value PER ONE YEAR. (Property taxes are per year, and the liability limit I propose is "per infringer per year" (or "per infringement per year" if infringement is defined in a macroscopic enough sense).
rlpb 10y ago
It would favour large institutional "inventors" and lock out individuals. An invention and subsequent patent is only the beginning of a pretty risky endeavour. There are significant risks in bringing a new product to market, such as in funding, timing, marketing, industrial production, and so on. Overall they will average out. Some patents will be more successful than expected, and some will bomb. Large companies will be able to make a guess, pay the tax, and overall they'll make a profit. The risk on a higher value and paying the tax isn't such a big deal for them. Small time inventors will be unable to take the risk and be forced to undervalue their own invention lest it bomb. They'll be exploited by large companies that will just pay the limited damages and then exploit their invention. All this would do is cap the return of small inventors, without affecting the carpet-bombing large companies. I hate patent trolls as much as the next HNer, but I don't think this idea will work, sorry. I'm a small time inventor with one patent filed, but I didn't pay the maintenance fees (I had to publish but didn't want to spend thousands more making it final) because it didn't make enough money so it's now in the public domain. A large company could take my work. If they make a success of it where I failed, good on them. But I'll be owed nothing (rather than a proportion), which I think would be unfair since they'd be using my work. I'm already a victim of having been unable to spread the risk in a way that large companies can do.
- beagle3 10y ago
  There is no point in getting a patent if you cannot enforce it. The current situation already favors large patent owners, and my proposal will not make that worse, I believe. > All this would do is cap the return of small inventors, without affecting the carpet-bombing large companies. On the contrary. IBM and MS have tens to hundreds of thousands of patents. Keeping them all "Ready to sue" would cost them billions. And .. a small inventor who can't afford $100K in court fees does not have patent protection even if they have a patent. > If they make a success of it where I failed, good on them. But I'll be owed nothing (rather than a proportion), which I think would be unfair since they'd be using my work. I'm already a victim of having been unable to spread the risk in a way that large companies can do. So ... if you had paid $0, then a company made money of it, increase the value that year to $1M (pay the $10K tax) and have them license or sue them. You're better off under my proposed system.

Patents and trademarks maybe, but copyright? You have copyright on basically anything you create. Should I pay taxes on everything I put on github? On essays I write? What if I'm a famous artist? If I make some artwork to go in my living room, should I really pay 1% of the assessed value of that every year? If I write a book, is it not enough to pay taxes on the income I get by selling my book? Should I really have to pay taxes on it to keep it out of the public domain?

reitanqild 10y ago
Thanks! I feel a little less smart now which is a good sign. :-)
bostonvaulter2 10y ago
Who said anything about copywright?
- lordnacho 10y ago
  Copyright is a form of IP.
- jahnu 10y ago
  > Intelectual Property (especially patents and copyrights)
Aaargh20318 10y ago
> If I write a book, is it not enough to pay taxes on the income I get by selling my book? If I rent out a house, is it not enough to pay taxes on the income I get from rent ? > Should I really have to pay taxes on it to keep it out of the public domain? Yes. If you build a house with your own two hands, should you not pay property tax on it ?
- astrodust 10y ago
  A house takes up physical space. Intellectual property doesn't. The reason we have property taxes is because maintaining the environment around the house costs money. There's no roads and sewers and schools for books.
  - beagle3 10y ago
    there are a lot of costs involved with enforcing property rights. It's not sewers but it is legal departments, customs offices and law enforcement officers. Also, a patent takes space by disallowing me to use the same kind of invention (even if I came up with it independently). And a copyright sometimes stops me from being able to use a "cultural common". They most definitely take space. And real estate property taxes are often supplemented by "road maintenance levies". They don't directly support the property's infrastructure when you really look into it.
    - astrodust 10y ago
      Patents are a fairly large investment, plus they're a fixed life-span item. Although I'm largely against patents, fiddling with the fees associated with them won't help solve any problems. Now when it comes to copyright enforcement, 99.99% of the copyrighted material out there is never formally published. It's source code, it's email, it's creative works produced and shared but never curated or packaged. How can you possibly tax all of that?
      - beagle3 10y ago
        If it's not published, its protection comes mostly from not being seen (in private setting) or from trade secrets and associated laws. If only want to use the tax as a way to make sure orphaned works can be shared, and patent trolls become unprofitable. I believe that an IP tax can help both. I think it is essential to force proper valuation of IP, and I think tying it to recovery (upside) and taxes (downside) is likely to give a proper evaluation. It is not my intention to try to tax your own painting on your living room. I assume, by default, anything not listed, is valued at $0 for that year. Do you understand that, regardless for copyrights or patents, your IP is not enforceable unless you can afford the court action?
randomdata 10y ago
It was suggested elsewhere that you would assess the value yourself, so if the only utility of your work is to hang it in your living room, you could claim it has $0 copyright value, and thus pay no tax. The implication is that if someone decides to copy it, your claim for damages in court is based on that $0. But if your intent is to keep a private copy in your living room without the willingness to share with the public who gave you the privilege of copyright in the first place, perhaps that still remains fair.

DKnoll 10y ago

Because it would make the misappropriation of the work of poor creators cheap.

darawk 10y ago
But if they had something worth keeping, they could ideally get financing from someone who'd want to own it. At least, that's what should happen in an efficient market.
- totony 10y ago
  A poor person will have to sell his idea or else he wont be able to patent it. What was proposed may solve some problems, but if it deepens that inequality hole I dont think its worth it. If you own a unused property, in comparison, shows you have significant funds
  - beagle3 10y ago
    A poor person already has to sell it. Patents cost a minimum of $5,000, usually not less than $20,000 and often not less than $50,000 all things accounted for. That's just filing - it can take upwards of 5 years to get approved or rejected. And then, it is STILL worth nothing because you have to sue to enforce infringement, at costs north of $100,000 more often than not. I propose that the value of IP for tax purposes is owner assigned. If you have no money to pay the tax, just declare $1. The catch is, that would make you ineligible to recover much more than that in the case of infringement. As far as poor people, it changes little to none. But it grounds patent valuation, which are now arbitrary.
    - will_brown 10y ago
      There are a few fundamental flaws with your proposal, but namely the inventor of a patent or holder of IP generally does not just randomly assign a value to their IP and win that amount in the instance of infringement. It's sort of the whole point of proving damages, because it would be impossible to calculate future damages for a violation of IP at the time the IP was created. For example I invent and patent the widget and assign a $1B valuation to the invention. Apple violated my patent, manufactures the widget and sells $100M. Should I sue, my potential damages have nothing to do with the $1B valuation I made up but with the damages I suffered as a result of Apple violating my patent. Alternatively I write a book and slap $1 valuation, because I assume there is no market for my writing or to avoid the big tax until I make it big. JK Rowling Violated my copyright and slaps her name on my book and sells millions of copies, again my damages have zero relation to the valuation I created for the IP.

hengheng 10y ago

Valuation of IP is not easy. Even if you invest a lot of effort, there will be some big error bars.

beagle3 10y ago
Of course. But they will still be about a hundred times smaller than they are today. Today, someone thinks of an idea, patents it and estimates its worth at $100M. Someone else develops the same idea and assigns a value of $20K. That's the error bar TODAY. Inventor has no incentive for realistic estimate - they will always overestimate (no penalty for that). An infringer has no incentive for a realistic estimate (no additional penalty for that if he loses in court). An ip tax will decrease the error bars by forcing the patent owner to pay for overestimates.
Aaargh20318 10y ago
That is the whole point. Either you agree that IP is real property and as such it should be taxed, or you don't and and you pay no taxes. If your property has value, then you should pay property tax. If it has no value, you cannot claim damages if someone 'steals' said property since it wasn't worth anything. You can't have your cake and eat it. If you start taxing imaginary property, this will force IP owners to consider wether their IP has actual value or not and act accordingly.

will_brown 10y ago

Because creating an acurate valuation for IP at the time IP is created that would be accurate for the life of the IP is impossible. Moreover, it would make no sense for that made up valuation for tax purposes to determine future potential damages in IP infringement cases. Edit: to bring the concept to perspective, imagine having to assign a valuation to new borns so in the instance they die as a result of negligence the damages are capped at the assigned valuation of the deceased at their birth.

ianai 10y ago
Values are placed on people's lives all the time for insurance. I'm thinking for IP a flat tax may make most sense. It would incentivize letting go of at least some things. If it's $5 fewer things will go public than if it's $1000, for instance. It should probably be more to actually affect companies.
beagle3 10y ago
I didn't explicitly state this here (I did numerous times before when discussing this) but property tax is annual, and I propose value assignment be annual as well. Therefore, if at the end of the year neither yourself nor anyone else had made any money from your IP, just assign zero. At the moment, patents are cheap compared to the value they have as an offensive weapon, and this is what I hope to address with my proposal. As for copyrights - the same framework would make infinite extension unaffordable even for Disney, so I hope we would all benefit.
- pakitan 10y ago
  You can only determine the exact IP revenue when someone is paying explicitly for the use of that IP. If, however, I'm selling, say, a very complex machine, where I hold a patent over a small component of that machine, how would you determine the value of my patent? > Therefore, if at the end of the year neither yourself nor anyone else had made any money from your IP, just assign zero How would that solve the issue of patents being used as a offensive weapon? Under your proposal if a patent troll has thousands of patents and has made zero revenue on them, they would pay zero tax. On the other hand if they made money, they will happily pay the tax.

mseebach 10y ago

So, capping damages at the listed value of the patent basically means that you have a standing offer to sell a perpetual non-exclusive license to any one for any reason. This means that for anything truly valuable (say, medicine), the value would probably have to be assessed in the several billions. Medicine can take tens of years to commercialise, so we've just raised the cost of developing new medicine substantially. So, rather, it would probably discourage patenting these things (in favour of keeping them deeply confidential) until their value has actually been proven, which goes against the purpose of the patent system in the first place, to encourage the disclosure of inventions in exchange for a monopoly on exploiting it.

beagle3 10y ago
> So, capping damages at the listed value of the patent basically means that you have a standing offer to sell a perpetual non-exclusive license to any one for any reason. Yes. At full value PER ONE YEAR. (Property taxes are per year, and the liability limit I propose is "per infringer per year" (or "per infringement per year" if infringement is defined in a macroscopic enough sense).

rlpb 10y ago

It would favour large institutional "inventors" and lock out individuals. An invention and subsequent patent is only the beginning of a pretty risky endeavour. There are significant risks in bringing a new product to market, such as in funding, timing, marketing, industrial production, and so on. Overall they will average out. Some patents will be more successful than expected, and some will bomb. Large companies will be able to make a guess, pay the tax, and overall they'll make a profit. The risk on a higher value and paying the tax isn't such a big deal for them. Small time inventors will be unable to take the risk and be forced to undervalue their own invention lest it bomb. They'll be exploited by large companies that will just pay the limited damages and then exploit their invention. All this would do is cap the return of small inventors, without affecting the carpet-bombing large companies. I hate patent trolls as much as the next HNer, but I don't think this idea will work, sorry. I'm a small time inventor with one patent filed, but I didn't pay the maintenance fees (I had to publish but didn't want to spend thousands more making it final) because it didn't make enough money so it's now in the public domain. A large company could take my work. If they make a success of it where I failed, good on them. But I'll be owed nothing (rather than a proportion), which I think would be unfair since they'd be using my work. I'm already a victim of having been unable to spread the risk in a way that large companies can do.

beagle3 10y ago
There is no point in getting a patent if you cannot enforce it. The current situation already favors large patent owners, and my proposal will not make that worse, I believe. > All this would do is cap the return of small inventors, without affecting the carpet-bombing large companies. On the contrary. IBM and MS have tens to hundreds of thousands of patents. Keeping them all "Ready to sue" would cost them billions. And .. a small inventor who can't afford $100K in court fees does not have patent protection even if they have a patent. > If they make a success of it where I failed, good on them. But I'll be owed nothing (rather than a proportion), which I think would be unfair since they'd be using my work. I'm already a victim of having been unable to spread the risk in a way that large companies can do. So ... if you had paid $0, then a company made money of it, increase the value that year to $1M (pay the $10K tax) and have them license or sue them. You're better off under my proposed system.