7 ms·

Real property owners also pay tax on their income. Income is taxed. Real property is taxed. Intellectual property is not.

brookst 8mo ago
IP is next to impossible to appraise, unlike land. It’s pretty easy to ballpark what a lot of house or office building is worth based on comparables that sold recently. IP doesn’t sell that much and comparisons are harder.
- closewith 8mo ago
  This is actually a solved problem. It is self-assessed valuation with compulsory sale at declared value, known as the Harberger Tax.
  - ralferoo 8mo ago
    This is only a solution if you think it's fair to have a regular ownership tax on top of the tax paid when purchasing / selling something.
    - closewith 8mo ago
      It's a solution to the problem raised by the GP - how to fairly value IP. This whole thread is about how many countries with land taxes don't similarly tax other assets like IP. Whether you think it's fair or not is another question - the blocker isn't fair valuation.
      - bryanrasmussen 8mo ago
        the solution to how to fairly value IP was provided by the owner, capital gains tax happens on sale of IP https://news.ycombinator.com/item?id=47220210 https://news.ycombinator.com/item?id=47220210 capital gains does not happen on sale of land generally. These two things are obviously taxed differently because it is to the value of the government to do so, and the value of the government is supposed in many countries to somehow translate into a value for society.
        closewith 8mo ago
        Profits from property sales are often tax as CGT. It's only a select few jurisdictions that don't tax property sales, often with both CGTs and stamp duties. The difference in how their taxed in the US is certainly not standard globally, nor is it likely to be optimal.
        bryanrasmussen 8mo ago
        OK I did not know this about the U.S, having never owned property there. Actually seems a bit weird to find a tax situation in the U.S that seems less beneficial to the person paying the tax than many other countries.
  - boomlinde 8mo ago
    The effect of a Harberger tax on intellectual property would probably be an upwards transfer of ownership of intellectual property, from people who can't afford to pay taxes on whatever those 100,000x more wealthy are willing to pay. A Harberger tax might work well in economist-land, where any discrepancy between what wealth I could extract from my property and what wealth I actually extract from it represents an inefficiency that can be addressed by a transfer of ownership at market value at no inconvenience to the original owner. In reality, there are many other reasons than market value that I might hold onto intellectual property.
  - wang_li 8mo ago
    That's a dumb system as it doesn't account for the fact that a piece of property's value can change over time. You write a book, you have to declare its value prior to knowing it's value to consumers. If you aren't independently wealthy already you will never be able to become wealthy by writing books, paintings, songs, etc. as you will have to declare their value quite low in order to pay taxes on them. If it becomes popular the publishing company comes along and forcibly buys it from you for the low value you had to put on it because you couldn't pay the tax, then raises it's value far beyond what the author could afford and profits from the movies rights and etc.
  - brookst 8mo ago
    My mother wrote some tiny-selling (at the time) books; I own the copyright now. There is zero revenue (which is fine). Should I be forced to pay something every year to prevent some AI company from bidding $1 and taking ownership?
    - closewith 8mo ago
      I think so, yes, or you could place the copyright in the public domain. Your current situation is a prime example of the failure of current copyrights. You aren't incentivised to produce any new art, it was unearned as you weren't the author, and yet still the state enforces the copyright for you.
- toast0 8mo ago
  Copyright is easy to appraise. Estimate the stream of payments it will generate; take the net present value using an appropriate estimate of a safe interest rate. Will it always match the actual value? No, of course not. Sometimes popularity changes a lot, or interest rates change a lot. I'm not sure you really need a proprerty tax on copyrights though. They generate taxable income until they expire. It seems more fair to tax the actual income rather than appraised value, to avoid problems from cases where the appraisal is too high or too low.
  - simonh 8mo ago
    So of I write a novel and never publish it, how should its value be calculated? If what matters is actually revenue, well, revenue is already taxed when it’s incurred. Suppose there is no future revenue, do I get the tax back eventually?
    - toast0 8mo ago
      If you never publish it, and it's never published after your death; objectively it produced no income and has a monetary value of $0. With no offense to you or your novel; I would appraise an unpublished novel by an unknown author at something like $100, which might be too high. Some turn out to be worth much more, but most will be produce $0 or less for the author's estate.
      - simonh 8mo ago
        How is that tax going to be assessed and by who? What constitutes a novel or a book over a set of well written notes? This whole idea is ludicrous, are we going to raid people's homes and audit their computers and notebooks to see if they've written anything that might be valuable? Just tax their income. We already do it.
  - brookst 8mo ago
    “Estimate the stream of payments”… how? Like what is the McDonalds tradework worth? What is tbe stream of payments?
simonh 8mo ago
I'm in the UK. Simply owning land does not incur taxes here, we don't have land value taxes. You pay capital gains tax on profits selling land. There are annual taxes on buildings such as council taxes on houses, specifically to pay for municipal services, but not generally on land. If I make goods I'm not taxed for owning them, only if I earn income from the sale or use of those goods.
- closewith 8mo ago
  There are some analogues of a land tax in the UK. Council tax for residential property, rates for businesses, and the upcoming mansion tax.
  - simonh 8mo ago
    And I think that makes sense because residences impose costs on local services. However if I write a novel aged put it on my bookshelf, or if I paint a picture ad put it on my wall, I’m not imposing a cost on anyone just because these might have some theoretical value. How would their value even be measured?
bryanrasmussen 8mo ago
Real property is taxed, but often you do not pay capital gains on sold real property (this "often" of course varies by jurisdiction, so yes in lots of places you may pay some if the conditions are right), when selling intellectual property you often (same proviso as before, only inverted) pay capital gains.
kube-system 8mo ago
Real property is sometimes taxed. Certain uses/users are partially exempt from taxation, and some uses/users are entirely exempt. It is not legal to rob these properties, nor should it be.
dghlsakjg 8mo ago
Taxing copyright ownership is effectively impossible. Unless you want to figure out how to receive a tax bill for the comment you have written. Just about any written or artistic artifact you create is subject to copyright protection. How do you begin to decide how a tweet should be taxed

brookst 8mo ago

IP is next to impossible to appraise, unlike land. It’s pretty easy to ballpark what a lot of house or office building is worth based on comparables that sold recently. IP doesn’t sell that much and comparisons are harder.

closewith 8mo ago
This is actually a solved problem. It is self-assessed valuation with compulsory sale at declared value, known as the Harberger Tax.
- ralferoo 8mo ago
  This is only a solution if you think it's fair to have a regular ownership tax on top of the tax paid when purchasing / selling something.
  - closewith 8mo ago
    It's a solution to the problem raised by the GP - how to fairly value IP. This whole thread is about how many countries with land taxes don't similarly tax other assets like IP. Whether you think it's fair or not is another question - the blocker isn't fair valuation.
    - bryanrasmussen 8mo ago
      the solution to how to fairly value IP was provided by the owner, capital gains tax happens on sale of IP https://news.ycombinator.com/item?id=47220210 https://news.ycombinator.com/item?id=47220210 capital gains does not happen on sale of land generally. These two things are obviously taxed differently because it is to the value of the government to do so, and the value of the government is supposed in many countries to somehow translate into a value for society.
      - closewith 8mo ago
        Profits from property sales are often tax as CGT. It's only a select few jurisdictions that don't tax property sales, often with both CGTs and stamp duties. The difference in how their taxed in the US is certainly not standard globally, nor is it likely to be optimal.
        bryanrasmussen 8mo ago
        OK I did not know this about the U.S, having never owned property there. Actually seems a bit weird to find a tax situation in the U.S that seems less beneficial to the person paying the tax than many other countries.
- boomlinde 8mo ago
  The effect of a Harberger tax on intellectual property would probably be an upwards transfer of ownership of intellectual property, from people who can't afford to pay taxes on whatever those 100,000x more wealthy are willing to pay. A Harberger tax might work well in economist-land, where any discrepancy between what wealth I could extract from my property and what wealth I actually extract from it represents an inefficiency that can be addressed by a transfer of ownership at market value at no inconvenience to the original owner. In reality, there are many other reasons than market value that I might hold onto intellectual property.
- wang_li 8mo ago
  That's a dumb system as it doesn't account for the fact that a piece of property's value can change over time. You write a book, you have to declare its value prior to knowing it's value to consumers. If you aren't independently wealthy already you will never be able to become wealthy by writing books, paintings, songs, etc. as you will have to declare their value quite low in order to pay taxes on them. If it becomes popular the publishing company comes along and forcibly buys it from you for the low value you had to put on it because you couldn't pay the tax, then raises it's value far beyond what the author could afford and profits from the movies rights and etc.
- brookst 8mo ago
  My mother wrote some tiny-selling (at the time) books; I own the copyright now. There is zero revenue (which is fine). Should I be forced to pay something every year to prevent some AI company from bidding $1 and taking ownership?
  - closewith 8mo ago
    I think so, yes, or you could place the copyright in the public domain. Your current situation is a prime example of the failure of current copyrights. You aren't incentivised to produce any new art, it was unearned as you weren't the author, and yet still the state enforces the copyright for you.
toast0 8mo ago
Copyright is easy to appraise. Estimate the stream of payments it will generate; take the net present value using an appropriate estimate of a safe interest rate. Will it always match the actual value? No, of course not. Sometimes popularity changes a lot, or interest rates change a lot. I'm not sure you really need a proprerty tax on copyrights though. They generate taxable income until they expire. It seems more fair to tax the actual income rather than appraised value, to avoid problems from cases where the appraisal is too high or too low.
- simonh 8mo ago
  So of I write a novel and never publish it, how should its value be calculated? If what matters is actually revenue, well, revenue is already taxed when it’s incurred. Suppose there is no future revenue, do I get the tax back eventually?
  - toast0 8mo ago
    If you never publish it, and it's never published after your death; objectively it produced no income and has a monetary value of $0. With no offense to you or your novel; I would appraise an unpublished novel by an unknown author at something like $100, which might be too high. Some turn out to be worth much more, but most will be produce $0 or less for the author's estate.
    - simonh 8mo ago
      How is that tax going to be assessed and by who? What constitutes a novel or a book over a set of well written notes? This whole idea is ludicrous, are we going to raid people's homes and audit their computers and notebooks to see if they've written anything that might be valuable? Just tax their income. We already do it.
- brookst 8mo ago
  “Estimate the stream of payments”… how? Like what is the McDonalds tradework worth? What is tbe stream of payments?

simonh 8mo ago

I'm in the UK. Simply owning land does not incur taxes here, we don't have land value taxes. You pay capital gains tax on profits selling land. There are annual taxes on buildings such as council taxes on houses, specifically to pay for municipal services, but not generally on land. If I make goods I'm not taxed for owning them, only if I earn income from the sale or use of those goods.

closewith 8mo ago
There are some analogues of a land tax in the UK. Council tax for residential property, rates for businesses, and the upcoming mansion tax.
- simonh 8mo ago
  And I think that makes sense because residences impose costs on local services. However if I write a novel aged put it on my bookshelf, or if I paint a picture ad put it on my wall, I’m not imposing a cost on anyone just because these might have some theoretical value. How would their value even be measured?

bryanrasmussen 8mo ago

Real property is taxed, but often you do not pay capital gains on sold real property (this "often" of course varies by jurisdiction, so yes in lots of places you may pay some if the conditions are right), when selling intellectual property you often (same proviso as before, only inverted) pay capital gains.

kube-system 8mo ago

Real property is sometimes taxed. Certain uses/users are partially exempt from taxation, and some uses/users are entirely exempt. It is not legal to rob these properties, nor should it be.

dghlsakjg 8mo ago

Taxing copyright ownership is effectively impossible. Unless you want to figure out how to receive a tax bill for the comment you have written. Just about any written or artistic artifact you create is subject to copyright protection. How do you begin to decide how a tweet should be taxed