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LuckyOne

Intellectual Property (ip)

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I have been giving IP a bit of thought lately. This is what got me to thinking about it :

CCE2z9TVIAENCcE.png

IP is taking up an increasing share of total capital. It is very difficult to participate in the "production" of IP. It is even more difficult to acquire it. I think that the growth in the relative value of IP is a contributing factor to increasing inequality.

In the long run, we are going to have to face up to the fact that there are more people than good jobs and that some form of Citizen's Income is going to have to come into play. This will be very expensive and is a "down the road" discussion.

As Osborne is on such a roll, I think that he should consider disallowing the deductibility of offshore transfer payments for IP "rental" in the short term as a possible long term revenue source. This is one of the reasons that the offshore subsidiaries of large global conglomerates like Starbucks, Apple, Amazon etc pay very little tax in the UK (and elsewhere).

I am a believer in property rights. I do not believe that the owners of intellectual property have the right to unilaterally declare the jurisdiction in which it resides. I think that a reasonable approach is to say that it is deployed globally in rough proportion to their sales by country rather than 100% in Ireland, Malta, Luxembourg, Lichtenstein, Malta, Bermuda, Barbados etc. Disallowing the tax deductibility of offshore IP transfer payments will have the effect of allocating its deployment globally in rough proportion to sales.

In some ways, this is analogous to the way that Osborne has treated the deductibility of BTL mortgage interest. The deductibility of offshore IP transfer payments disadvantages purely domestic businesses competing in the same field. I believe in free markets. A distortion like this is not capitalism or free market behaviour. It is also more logical (obviously in my opinion) than the "turnover tax" solution that has been proposed and is easier to defend.

To be successful, this would most likely need to be agreed to by the G7 first (members are universally negatively impacted by the problem, including the US which sees a lot of stranded cash from their conglomerates sitting in low tax jurisdictions invested in financial instruments rather than being re-deployed in business activity), then by the G20 and then by the OECD. The only people who would complain are the aforementioned Ireland, Malta, Luxembourg, Lichtenstein, Malta, Bermuda, Barbados etc and the global owners of IP who are getting a huge tax break by making a unilateral jurisdictional declaration that they have no right to make.

I have recently left the UK but I am a British citizen and a registered voter. Have I got anything wrong that I need to correct before sending it off to my MP who happens to be a Cabinet Minister? It is a bit technical to explain and it will need at least a couple of edits but I think that many would see it as being completely fair if the Government could work out the details and reduce the opportunities for global conglomerates to game the system.

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I don't think I support this and I think you're conflating the issue of tax arbitrage with IP.

IP itself poses some interesting dilemmas if you get religious about it. For instance, suppose JK Rowling goes on holiday to France and sits on a beach in Cannes writing a new billion dollar blockbuster to rival Harry Potter. Should taxes on this income accrue to France by virtue of the fact that it was the location of the creation of the intellectual property?

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I have been giving IP a bit of thought lately. This is what got me to thinking about it :

CCE2z9TVIAENCcE.png

IP is taking up an increasing share of total capital. It is very difficult to participate in the "production" of IP. It is even more difficult to acquire it. I think that the growth in the relative value of IP is a contributing factor to increasing inequality.

In the long run, we are going to have to face up to the fact that there are more people than good jobs and that some form of Citizen's Income is going to have to come into play. This will be very expensive and is a "down the road" discussion.

As Osborne is on such a roll, I think that he should consider disallowing the deductibility of offshore transfer payments for IP "rental" in the short term as a possible long term revenue source. This is one of the reasons that the offshore subsidiaries of large global conglomerates like Starbucks, Apple, Amazon etc pay very little tax in the UK (and elsewhere).

I am a believer in property rights. I do not believe that the owners of intellectual property have the right to unilaterally declare the jurisdiction in which it resides. I think that a reasonable approach is to say that it is deployed globally in rough proportion to their sales by country rather than 100% in Ireland, Malta, Luxembourg, Lichtenstein, Malta, Bermuda, Barbados etc. Disallowing the tax deductibility of offshore IP transfer payments will have the effect of allocating its deployment globally in rough proportion to sales.

In some ways, this is analogous to the way that Osborne has treated the deductibility of BTL mortgage interest. The deductibility of offshore IP transfer payments disadvantages purely domestic businesses competing in the same field. I believe in free markets. A distortion like this is not capitalism or free market behaviour. It is also more logical (obviously in my opinion) than the "turnover tax" solution that has been proposed and is easier to defend.

To be successful, this would most likely need to be agreed to by the G7 first (members are universally negatively impacted by the problem, including the US which sees a lot of stranded cash from their conglomerates sitting in low tax jurisdictions invested in financial instruments rather than being re-deployed in business activity), then by the G20 and then by the OECD. The only people who would complain are the aforementioned Ireland, Malta, Luxembourg, Lichtenstein, Malta, Bermuda, Barbados etc and the global owners of IP who are getting a huge tax break by making a unilateral jurisdictional declaration that they have no right to make.

I have recently left the UK but I am a British citizen and a registered voter. Have I got anything wrong that I need to correct before sending it off to my MP who happens to be a Cabinet Minister? It is a bit technical to explain and it will need at least a couple of edits but I think that many would see it as being completely fair if the Government could work out the details and reduce the opportunities for global conglomerates to game the system.

I can already see several loopholes that could be exploited. My hourly rate is 650 GBP....

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Guest eight

I have been giving IP a bit of thought lately. This is what got me to thinking about it :

CCE2z9TVIAENCcE.png

IP is taking up an increasing share of total capital. It is very difficult to participate in the "production" of IP. It is even more difficult to acquire it. I think that the growth in the relative value of IP is a contributing factor to increasing inequality.

That's the point - it would be difficult/impossible to build up the same amount of critical mass in purely physical terms.

I can see a point where some of these behemoths become so entrenched in everyday life that they come under some kind of globalised public control. They're not true private sector, they are their sector, and they are incredibly resistant to competition.

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There's unequal distribution in IP, if you make music you have an income for life, however if you have the skills to build a house you only get a single payment.

IP needs limits, books/music etc.... should be limited to 10 years.

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IP is a totally artificial system. Whatever rules you make up will have gaping edges.

Well, it gives us landless peasants a means of owning something through our own efforts.

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That's the point - it would be difficult/impossible to build up the same amount of critical mass in purely physical terms.

I can see a point where some of these behemoths become so entrenched in everyday life that they come under some kind of globalised public control. They're not true private sector, they are their sector, and they are incredibly resistant to competition.

The companies in that diagram aren't really known for owning IP. you or I could start a rival Facebook, we wouldn't get far, and that's not because of IP issues. Even Google+ failed to compete with Facebook.

Uber is not about taxis, it's about facilitating automated car usage and distribution. So while I agree that IP is a massive issue in the age of automation, it's only part of the bigger issue that under the current system, automation results in wealth accruing to the 'robot owners' and this is ultimately incompatible with consumer capitalism in its present form. i.e how do unemployed taxi drivers afford to pay for an automated taxi ride?

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IP is a totally artificial system. Whatever rules you make up will have gaping edges.

I think the chinese have it right with their knock off Range Rovers.

If Range Rovers are so good they wouldnt be worried about others plagiarizing their designs. They would sell on how well they were screwed together. (hint, they usually come last in reliability surveys, which is probably why they are so worried about the one thing they sell for, catchet),

All this copyright/IP and other stuff is a relic of government intervention. In a free market, copyrights should not exist. Hopefully increased participation in the open source arena will make it so.

I think that will be a big boost for reversing inequality (so, not suprisingly, governments will do everything in their power in an attempt to stop it)

Imagine, you can download blueprints for near anything, a lot like P2P music sharing...then print it on your very own 3d printer.

Its like going back to before there were big conglemerates....the de-centralization of production.

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IP is not free to create. Stupid idea.

Then it won't be created...or else companies would only rent out their products with conditions.

Of course, what will happen with increasingly free information, is the cost of producing it would fall. With computing power as it is, soon there will be no reason for R&D to be a significant cost.

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Then it won't be created...or else companies would only rent out their products with conditions.

Of course, what will happen with increasingly free information, is the cost of producing it would fall. With computing power as it is, soon there will be no reason for R&D to be a significant cost.

Sometimes you see things which are so wrong-headed they remind you that even with all the free information in the world, intelligence will always have scarcity value.

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I'm confused by OPs use of the term Intellectual Property. Thread seems to be about how to tax online global companies (with no sales location based physical assets)

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I think the chinese have it right with their knock off Range Rovers.

If Range Rovers are so good they wouldnt be worried about others plagiarizing their designs. They would sell on how well they were screwed together. (hint, they usually come last in reliability surveys, which is probably why they are so worried about the one thing they sell for, catchet),

All this copyright/IP and other stuff is a relic of government intervention. In a free market, copyrights should not exist. Hopefully increased participation in the open source arena will make it so.

I think that will be a big boost for reversing inequality (so, not suprisingly, governments will do everything in their power in an attempt to stop it)

Imagine, you can download blueprints for near anything, a lot like P2P music sharing...then print it on your very own 3d printer.

Its like going back to before there were big conglemerates....the de-centralization of production.

So what about someone who starts to make a land rover which is identical except for the colour of the badge? And it's poor quality and starts killing people? And LR loses market share as people do not know who to trust (see what has happened with aircraft replacement parts in some places in the world).

I don't believe in copyright and IP for +10 years for entertainment, but for physical objects, absolutely.

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http://blog.maidsafe.net/2015/03/19/the-next-generation-sharing-economy/

In this context, content creators could be a: blogger, journalist, artist, film maker, musicians, application developers, even end users with a social network account and a video camera. As my colleague Paige Peterson pointed out in an earlier post, the advent of crypto currencies like safecoin, with their almost zero transaction fees, enable almost instant micro payments and donations to take place.

Bloggers could be paid or tipped by users as their posts are read and enjoyed. News websites could function in the same way, or they could charge a subscription for providing well researched and useful information. Potentially, artists and film makers (this also includes those sharing funny home clips on YouTube) could make use of the SAFE Networks optional watermarking system to ensure that they are rewarded as the originator of content and continue to be rewarded as snippets of their song or film are built upon and used by or aggregated by others. Digitally recording the content creators (through an anonymous ID) of each piece of work will enable the network to manage and pay out rewards without human intervention and without corruption.

Some content creators may earn slowly at first, but as their content is used over and over again and accessed by a global network of consumers, their income will grow. This will give rise to a possibility of migrating from a winner take all economy to a more bell shaped distribution of wealth (depicted below) where income is much more evenly spread amongst a greater volume of earners. In this paradigm, power and wealth would not be focussed toward the elite minority creating a next generation sharing economy.

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Then it won't be created...or else companies would only rent out their products with conditions.

Of course, what will happen with increasingly free information, is the cost of producing it would fall. With computing power as it is, soon there will be no reason for R&D to be a significant cost.

Try and get a computer to create an original artistic idea.

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Do communists consider IP to be theft?

Pierre 'Property is theft' Proudhon, was an anarchist not a communist, and he was talking about land, not stuff.

He also said:

To be governed is to be watched over, inspected, spied on, directed, legislated at, regulated, docketed, indoctrinated, preached at, controlled, assessed, weighed, censored, ordered about, by men who have neither the right, nor the knowledge, nor the virtue. To be governed is to be at every operation, at every transaction, noted, registered, enrolled, taxed, stamped, measured, numbered, assessed, licensed, authorized, admonished, forbidden, reformed, corrected, punished...

So, I'm pretty sure he wouldn't have been a big fan of intellectual property law.

Edited by BuyToLeech

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All this copyright/IP and other stuff is a relic of government intervention. In a free market, copyrights should not exist. Hopefully increased participation in the open source arena will make it so.

Agreed.

The most difficult to create, most valuable i.p. - science - isn't subject to copyright or patent anyway.

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.

.....As Osborne is on such a roll, I think that he should consider disallowing the deductibility of offshore transfer payments for IP "rental" in the short term as a possible long term revenue source. This is one of the reasons that the offshore subsidiaries of large global conglomerates like Starbucks, Apple, Amazon etc pay very little tax in the UK (and elsewhere).......................

..... I think that a reasonable approach is to say that it is deployed globally in rough proportion to their sales by country rather than 100% in Ireland, Malta, Luxembourg, Lichtenstein, Malta, Bermuda, Barbados etc. Disallowing the tax deductibility of offshore IP transfer payments will have the effect of allocating its deployment globally in rough proportion to sales.......

... many of these companies and their likes should be held to pay tax at point of sale on VAT (now implemented) and Corporation Tax ...after all in many cases some have employee wages topped up by the UK taxpayer and should be paying corporation tax accordingly, instead of artificially propping up revenue at the expense of the UK taxpayer.....any move to reduce this practice is welcome....if they have to incorporate in each country ...so be it...we need to be smarter ..... :rolleyes:

Edited by South Lorne

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The most popular Youtuber is PewDiePie, and earns some $4m each year, and just plays video games and shouts and screams a lot.

Go figure!

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