Currently its an industry standard to cross license Intellectual Property. Often this is done in secret agreements. This Idea suggest that goverments tax trade IP just as traded material goods or services are taxed. If company A trades steel to company B for electricity, the the Internal Revenue Service requires Company A to include the fair market value of the electricity as income. Company B must declare the fair market value of the steel as income.
- Trading of IP may stop.- Trading IP continues with IP valued expensive. Goverment collect more taxes.- Trading IP continues with IP valued low. More companies could share the IP at lower cost. If a company tried to avoid taxes by declaring the traded IP as little value, then other companies could buy the IP at that cost. The company that owned the IP and traded it would be forced to sell it (at the same declared value) to anyone via the Clayton Antitrust Act or Robinson-Patman Act.
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I think you are quite right. These agreements look like barter to me. The IRS can and does tax barter exchanges for the monetary value of the exchanges. If you actually know of some such arrangements that are not being reported to the IRS, you might want to report them and try to collect a whistleblower's fee.
Ick. You'd force a severe slowdown of what little innovation there already is in the computer industry. Cross-licensing IP gives companies the ability to build on other companies' ideas, furthering the state of the art of the technology.
Taxing that is like taxing any other construction material; you retard growth. And I'm generally opposed to retarding technology.
Sevans, I trade a cat for a dog. So do I pay tax in dog poo or get credited in bags of dog food? Lucky for the government if the dog swallowed a coin. Where else would money come from in a barter economy?