Forgot your password?
typodupeerror
Patents Government United States Your Rights Online

Tax Loopholes No Longer Patentable 278

Posted by samzenpus
from the getting-rid-of-stupid dept.
Knowzy writes "A section of the America Invents Act disallows issuing a patent 'on a strategy for reducing, avoiding or postponing taxes,' according to Forbes. The article describes one such strategy in some detail. The USTPO has already issued 161 of these 'business method type' patents. 167 more were pending. The law only applies to future patent applications, leaving enforcement of existing patents an issue for the courts to decide."
This discussion has been archived. No new comments can be posted.

Tax Loopholes No Longer Patentable

Comments Filter:
  • FLAT TAX (Score:2, Insightful)

    by unixisc (2429386)
    Introduce a FLAT $$$ tax - not even a percentage of one's income, just a flat $$$ amount, and call it that. No different from everybody paying the same price for a bottle of coke @ the store. Or should shops start asking customers their income, and then charge them accordingly?
    • How about a flat rate tax on wealth instead. Why should the ultra-rich be able to sit there not earning, not paying taxes, and just getting the benefit of everything they own whilst we have to defend their property, police their stupid legal disputes, deal with their garbage, clean up the results of their wastefulness etc. etc. etc.

      • by jonbryce (703250)

        How do you value wealth? A lot of it is very subjective.

        • by PopeRatzo (965947) *

          How do you value wealth? A lot of it is very subjective.

          Price-to-market accounting.

          The idea of taxing wealth instead of income is very interesting.

          Did you know that .5% of the population owns $46trillion in wealth? A 5% tax on wealth would pay off the debt and provide health care and a pension for every American over 10 years.

          Total US wealth went from about $25Trillion in 1999 to $54 Trillion in 2009 and currently over $70 Trillion.

          How much has your wealth increased since 2009?

      • First, all productive assets are wealth. Factories, land, etc. (We can then discuses if gold, big homes, fancy cars, and artwork is a productive asset, but that is for another time). So, you are taxing productive assets - which reduces their value. People will be less interested in investing in long term projects because it will be worth less.

        If you do the math, because you are paying taxes every year, anything involving capital because much more expensive. It's very hard to invest in that climate. A wealth

      • So, how often do you plan on taxing that wealth? Say, somebody has $10 million, are you going to tax it every year? At what tax rate?
        The problem with taxing wealth is that that makes saving impossible for everyone, even those who do not have very much.
    • Re:FLAT TAX (Score:4, Insightful)

      by snowgirl (978879) on Thursday September 22, 2011 @03:53AM (#37477092) Journal

      Introduce a FLAT $$$ tax - not even a percentage of one's income, just a flat $$$ amount, and call it that.

      Right, so the person making $12,000 a year, who needs every single penny of their paycheck can pay exactly the same amount of tax that Bill Gates pays?

      And what of people who have no income? Shall we drag them into jail for not paying their taxes, because they have absolutely no way to pay for it?

      On second thought, your plan succeeds extraordinarily well in making being poor illegal; in fact, way much better than any of the numerous laws (like vagrancy) that local governments pass to making being homeless illegal. And then, once all the poor people are in jail, they'll never be able to afford paying their taxes then, so we can just keep them locked up eternally... or maybe we could just kill them all, since they're never going to get out of the grave we've already dug for them anyways. Then, maybe we could just make a protein paste out of them. You are absolutely a brilliant person, you are.

      • Surely since the poor are more likely to use social services they should be taxed more than the rich. Why should Bill Gates pay his $13,000 [outsidethebeltway.com] flat rate when he is unlikely to use madicare, medicaid or the state school system?
        • by snowgirl (978879)

          Too moderate? I'm perplexed as to how anyone could even write that based on my comment...

          Does my comment say something I don't understand it to say? Surely it only speaks towards the negation of a single idea... rather than espousing any personally held ideas, so perhaps it is just the vacuum of argument allowing people to insert their own ideas into my words?

          Honestly, my personal position on this matter is "tax the rich more", as they're afforded more benefits from society than any poor person will ever ex

        • by cbope (130292)

          I'll counter: Why should the poor pay a significantly larger *percentage* of their income for healthcare than the rich?

          Answer: They shouldn't. In order for healthcare to be affordable for all, the costs MUST be distributed across the whole of the population. The rich contribute more (in terms of dollars, not percentage) because they make more. It's certainly not hurting the rich, as they seem to be able to continue getting richer. The problem is the poor not being able to afford healthcare. The percentage o

      • You can't use logic on this type. One told me that he saw no reason Bill Gates should pay more taxes, in dollars, than a struggling single mother.

    • by migla (1099771)

      Dennis Moore, Dennis Moore
      Riding through the land
      Dennis Moore, Dennis Moore
      Without a merry band
      He steals from the poor. And gives to the rich
      Stupid bitch.

    • by Joce640k (829181)

      With a few modifications your moronic plan might work:

      They should abolish income taxes (too easy for the rich to dodge) and do it all via sales tax. Rich people buy more stuff so they'll pay more. People who are sensible with their money will pay less than the people who max out their credit cards. It's all good.

      Sales tax is a lot harder to cheat than income tax and having a simple tax system will save a lot of money in itself.

      • With a few modifications your moronic plan might work:

        They should abolish income taxes (too easy for the rich to dodge) and do it all via sales tax.

        Sales tax is a lot harder to cheat than income tax and having a simple tax system will save a lot of money in itself.

        Not really - what do you tax - the sales price or the value, such as the MSRP? People would just use creative ways to delink the selling "price" from the revenue received for big ticket purchases.

    • by mwvdlee (775178)

      Please tell; how high do you imagine such a "flat $$$ tax" would be?

      I can't imagine any flat tax low enough to be reasonably asked of minimum wage workers and still be high enough to fund an entire country.
      The coke bottle has the same price, but you can just choose to buy a cheaper brand or different type of fizzy drink.
      Will people be able to pay the tax of a cheaper government brand or a different type of government altogether?

    • Price discrimination is not illegal and it's not uncommon. In cases where fixed costs dominate replication costs, it can be necessary to be profitable in a competitive marketplace.

      Usually it doesn't happen for a bottle of coke at one store, because that's cheap and the store can't verify your wealth (I've heard of "food stamps" in the US but I'm not familiar with what they are really or if they apply here), but the store down the road which markets to people with higher salaries often has more expensive bo

    • by prefec2 (875483)

      The taxes are not there to pay the price of something, they are there so everyone in charged according to his or her abilities. People who get more money can pay more of that (in percent) than the poor. It is like the health system (in Europe) everyone with money pays according to his or her income and everyone gets the same insurance totally independent from the money they give. this is what a society does when they care for each other. The strong help the weak.

      And the tax system is modeled accordingly. Ho

  • by mehrotra.akash (1539473) on Thursday September 22, 2011 @03:34AM (#37477002)

    The fact that tax loopholes were patentable is disturbing in itself..

    • by Joce640k (829181)

      You'd think a government would WANT a thing like that patented...get it locked down and lawyers chasing people who used the method. /Not entirely sure how you find the people infringing on your patent...

      • I see two possibilities:

        1. They think that allowing patents on tax loophole methods will actually advance the art of tax loopholes.
        2. They want to be sure that their corporate buddies don't have any trouble using tax loopholes.
      • by kcbnac (854015)

        Bribe someone working at the IRS to look for certain "patterns" - of course, the bribe'd have to be sufficient to justify the prison sentence for "releasing" said info - but considering the probable patent infringement penalties/lawsuit payouts, one could afford a few IRS Agents every so often...

    • Someone should just patent getting a patent, patent trolling, and patent warring and be done with it.
  • by LordNacho (1909280) on Thursday September 22, 2011 @03:37AM (#37477016)

    So does this mean that before this, the government could have patented the loophole structures, thus closing them?

    Interesting example of the system getting so complicated it bites itself in the tail.

    • by shish (588640)

      The government doesn't need patent law to enforce its ideas - it just says "no" and the thing is illegal in itself. Plus, patents would only work if the government was first to publish it, they'd be useless for closing existing holes.

    • by jbeaupre (752124)

      Sort of. What it means is that instead of folks filing for patents on loopholes, thus making it difficult for others to copy that method (and thus at least partially closing them), Congress has gone and made is so that anyone can use any new tax loophole method (keeping them wide open).

  • by vkt-tje (259058) on Thursday September 22, 2011 @03:44AM (#37477058)

    I suppose a tax loophole is nothing more then a clever application of the law, right?
    So, forget about tax laws, take a simple example traffic rules.

    Well, then I'm filing a patent for stopping at a red light: everyone that stops at a red light must pay me 1$.

    This is exactly the same as a patent on a tax loophole: the application of laws.
    You must pay the patent holder for using a specific tax loophole, which is just an application of the law.
    Now I'm making you all paying for applying another law.

    Patents are hilarious and disastrous.

    • You can cry all you want about how ridiculous the system is, as long as there are lawyers with lawmaking friends in the government which make money off of it, there isn't going to change anything.

    • Stopping at a redlight can be considered a loophole to avoid paying the fine. Thus you should pay a royalty
      Not stopping at a red light can be considered as a loophole to avoid paying the royalty, thus you should pay a royalty.

      Extend for non binary decisions and enjoy!!

      • by Chrisq (894406)

        Stopping at a redlight can be considered a loophole to avoid paying the fine. Thus you should pay a royalty Not stopping at a red light can be considered as a loophole to avoid paying the royalty, thus you should pay a royalty.

        Extend for non binary decisions and enjoy!!

        Quick patent it. Then nobody will be able to stop at a red light without paying you.

        • by gomiam (587421)
          Neither will they be able to not stop at a red light without paying him. Ka-ching!
  • by CuteSteveJobs (1343851) on Thursday September 22, 2011 @03:47AM (#37477072)
    > Tax Loopholes No Longer Patentable

    LOL Congress. Stand near their dinner bowl and your Congressman will spring into action. Yet Submarine Patents and Patent Trolling are still legal. The USPTO continues to approve the stupid, trivial and obvious patents and those written in such ridiculous language that no one knows what they mean. The USPTO leaves it to the courts to sort out the mess for them, with $500 an hour lawyers who will argue adamantly for whoever is paying them. (They should have a rule in Patent Law suits that half-way the lawyers change sides)

    But seriously: A startup hit by a Patent Troll will spend $1M to $5M to fight it off. How does bogging down startups like this help America invent? It doesn't. Congress have known about this for years but won't do lift a finger. But a tax dodging patent? Suddenly their outraged cannot be contained!
    • by snowgirl (978879) on Thursday September 22, 2011 @04:03AM (#37477128) Journal

      But seriously: A startup hit by a Patent Troll will spend $1M to $5M to fight it off. How does bogging down startups like this help America invent? It doesn't.

      Patents were never designed to do any such thing. It may have been post hoc rationalized as something to increase inventiveness, and honestly, I don't think there is any compelling data supporting either side.

      Patents were intended to give a person an exclusive right to produce a new invention and make money off of it. Thus, patents are about greedily hording inventions and technology away from others in exchange for disclosing how they actually work, so that later (100s of years) that information would not have gone to your grave with you. (Like many kinds of stained glass that we no longer know how to make, because no one passed it on.)

      It's basic purpose is to exploit greed to provide a benefit to mankind at a later date... this of course has the obvious effect of stunting the development and innovation cycle, because you can't use other people's ideas once they're actually available. I read an interesting piece about fashion, as it turns out that one cannot patent, copyright, or trademark fashion designs, and thus anyone can just steal an idea from someone else. Yet, they have a vibrant, active, and rapid development cycle. Of course it also renders old things "out of fashion" quite quickly as well, as soon everyone will have it, if it is popular enough.

      • by am 2k (217885)
        It wasn't hundreds of years, the time span was originally pretty short and got extended (20 years in the US now I believe). The issue in the IT sector is that after such a long time span, the inventions are irrelevant. Nobody cares about patents that are only applicable to 5MHz supercomputers nowadays.
        • by snowgirl (978879)

          It wasn't hundreds of years, the time span was originally pretty short and got extended (20 years in the US now I believe). The issue in the IT sector is that after such a long time span, the inventions are irrelevant. Nobody cares about patents that are only applicable to 5MHz supercomputers nowadays.

          Yes, I was exaggerating, and you're absolutely right that the obsolescence rate of patents in electronics is increasing far faster than the expiration rate of patents, so when thy finally expire, they're essentially worthless. (N.B. there are a lot of people who are eager to build NES and SNES systems as soon as the patents expire. But this is far more of a "niche" interest than actual interest in advancing technology, and innovation.)

          I remember in my history of engineering class, they talked about how the

          • by am 2k (217885)

            Hmm the GIF patents expiring were a pretty big deal (but not due to the technological superiority, just because everyone had a lot of those files) and Apple's expired font hinting [wikipedia.org] patents are still relevant as well, but those are the only ones I can remember, which is a pretty bad ratio for the number of software patents expiring all of the time.

            • by snowgirl (978879)

              Hmm the GIF patents expiring were a pretty big deal (but not due to the technological superiority, just because everyone had a lot of those files) and Apple's expired font hinting [wikipedia.org] patents are still relevant as well, but those are the only ones I can remember, which is a pretty bad ratio for the number of software patents expiring all of the time.

              True, I will say that the things that truly deserve to be patentable will be relevant once the patent expires. Perhaps that would be a better test for patentability? "Will this invention still be relevant once the patent expires?"

              Of course, much like making the perfect task scheduler for a computer requires it to be prescient, I doubt such a question would actually be workable...

              • by am 2k (217885)

                A patent examiner I know told me that they get patent applications for devices that do things like this all of the time ;)

      • Patents were never designed to do any such thing. It may have been post hoc rationalized as something to increase inventiveness

        In the US, at least, this just isn't true, since the legal justification for patents (and copryights, and trademarks) is spelled out in the Constitution: "To promote the Progress of Science and useful Arts ..." It's true, of course, that any rational person can now see that the arcane, jerry-rigged, and corrupt body of IP law doesn't actually work to that end, but the intention was clear enough. And in fact, I'd argue that patents on physical inventions do serve the stated purpose. It's when we allow pa

        • by snowgirl (978879)

          So, patents never existed prior to the US Constitution, so thereby, when declared in the US Constitution it declares clearly the purpose and design of patents ab initio?

          Or could it be that the post hoc rationalization of the purpose of the patent (as a meme) already existed, and was widely already propagated by the time the US Constitution was written, and that in a vein attempt to convince themselves of the purpose of a tool, they declare it loudly and explicitly without regard to the original design?

          You k

          • by hedwards (940851)

            What it means is that they were added to the constitution with that in mind. Without being in the constitution it would be less likely that patents would exist in the US.

            Or are you just making a post hoc rationalization for why the original post was correct by changing the parameters and hoping that nobody notices?

      • by Kjella (173770)

        (Like many kinds of stained glass that we no longer know how to make, because no one passed it on.)
        (...)
        this of course has the obvious effect of stunting the development and innovation cycle, because you can't use other people's ideas once they're actually available

        So how exactly could you use that stained glass technique? Oh right, it was never made available. If it had been patented, it must have been disclosed immediately, it'd be a monopoly on them for 20 years but people could understand what you did and start thinking of improvements or variations that wouldn't be covered.

        And there is really the biggest reason I don't think patents have much value anymore, who actually reads patents to learn something? Nobody, just lawyers and patent trolls. If there's no trade

    • Yet Submarine Patents..... are still legal.

      How are (new) submarine patents possible? AFAIU, a few years ago the USPTO came in to line with the rest (or at least most) of the world in that a patent application automatically becomes public 18 months after filing. Prior to that, (again AFAIU), it only became public when granted, and hence submariners would keep tweaking their application so it stayed in the exam process until a time that suited them.

    • by vawwyakr (1992390)
      I see the opposite here. This makes tax loopholes available to all. So it seems to me that more companies will be able to use them not less.
  • You can still patent all manner of ridiculous and stupid shit, but don't dare try to patent something that affects the US government's bottom line.
    • by hedwards (940851)

      People were filing the patents, but when was the last time anybody successfully used the patents in court?

  • by X10 (186866)

    "Tax Loopholes No Longer Patentable"

    OMG.

  • OMG, I wish there was a patent on making lame jokes (of the form: I wish there was a patent on XXX). Then assholes (like me) who make these pathetic attempts at humour would get sued into bankruptcy. I know there's no shortage of prior art (see any /. thread mentioning patents for last 10 years), but that never stopped anyone.

    • a patent limits the number of people able to use the loophole to those who buy a licence.
    • a patent gives the full details on how the loophole works making it much easer to write legislation to plug it.
  • Tax loophole patents are great!
    The problem isn't the patents, it's the fact that loopholes exist at all.
    At least patenting the loopholes makes sure the tax office knows what tricks are used, making it easier the close them.

    • by Rich0 (548339)

      Loopholes are simply the result of a lousy judicial system.

      The problem is that the law has become a game. Whether an action harms society is not important - only whether you can successfully argue that it isn't covered by the law.

      I know somebody who teaches ethics and he says that lawyers are the worst students. They'll come up with scenarios and ask for a "ruling" on whether it is ethical. Then they'll tweak some aspect of the scenario and repeat the question, with the goal of optimizing the scenario to

  • So when someone invents a cunning method to combine existing applications, that he may patent. But when someone else does exactly that and it is against the interest of the lawmakers, then the law gets quickly patched, but of course only to favour lawmakers.

    I sense a teeny weeny bit of opportunism at work here.

"A great many people think they are thinking when they are merely rearranging their prejudices." -- William James

Working...