I...really don't hate this idea. "Commerce Department officials are discussing charging patent holders 1% to 5% of their overall patent value, a shift that could dramatically increase fees, according to people familiar with the matter"
Replies
This but for copyrights + distributing the proceeds in the form of grants for writers/musical artists & production tax credits for indie film/television projects.
jul 28, 2025, 7:44 pm • 0 0 • view
I think this would be bad if we tried to use it as a revenue generator. it's fine tho if we set it low enough to discourage people from sitting on stuff they're not using & patent trolls. I'd also do broad categorization- pharma and bleeding edge tech should have different rates
jul 28, 2025, 8:01 pm • 5 0 • view
Whatcha mean by bleeding edge tech? Parents are all supposed to be new tech 😅
jul 28, 2025, 8:10 pm • 1 0 • view
I mean like AI and microcomputing and stuff. "Tech" tech.
jul 28, 2025, 8:16 pm • 1 0 • view
though like 5G patents are the kind of rent seeking this tax would be most appropriate for. otoh AI, like most software patents, are mostly just something companies load up on so that they have a pistol to use in a Mexican standoff situation. Maybe just don't value such patents highly.
jul 28, 2025, 10:03 pm • 0 0 • view
I don't mean to say that 5G and the like should necessarily have lesser rates! Just that they should receive particular analysis and consideration, vs other categories which could be more blanket/less reviewed
jul 28, 2025, 10:15 pm • 0 0 • view
You're going to have to value patents in every category by some metric. I don't think giving low valuations is really good "better" for an industry since patents are frequently an impediment to innovation.
jul 28, 2025, 10:46 pm • 0 0 • view
extremely mixed feelings
jul 28, 2025, 7:41 pm • 0 0 • view
When is the value of the patent decided? At the time of issue, or at some point in the future, or is it constantly evaluated? I mean... the patent for Betamax might have anticipated the roaring success it later became, right?
jul 28, 2025, 8:26 pm • 3 0 • view
Nice tax on $IBM - sure why not
jul 28, 2025, 8:07 pm • 1 0 • view
Going after patent trolls would be ok, it at least bleed em
jul 28, 2025, 7:50 pm • 4 0 • view
1-2% is nothing. We have to shrink our annual deficit. Consumers and low middle income are tapped out with these tarrifs.
jul 28, 2025, 8:02 pm • 1 0 • view
I'm pretty anti-troll but man I think this could end very badly
jul 28, 2025, 8:37 pm • 0 0 • view
How is a patent valued?
jul 28, 2025, 7:56 pm • 6 0 • view
Yup. This is the most important question at this stage. A vast majority of them are not commercialized or have no actual commercial value. And the patent system is much more important to smaller businesses these days - to which this new approach may harm.
jul 28, 2025, 8:35 pm • 5 0 • view
I have long thought that the Federal Reserve should have the right to set a patent fee tax rates, "generic fee" patent licensure rates, and "land development rental rates" to better meet their dual mandate. When the economy tanks (or inflation soars), the Federal Reserve needs more levers to pull.
jul 28, 2025, 8:31 pm • 0 0 • view
it should be higher.
jul 28, 2025, 8:16 pm • 17 0 • view
"the thing that drives all long-run economic growth and has for our entire lives gets 4% of all budget" is incredibly low actually
jul 28, 2025, 8:49 pm • 17 1 • view
Was? The past is not a predictor of the future and the future looks like garbage.
jul 28, 2025, 9:45 pm • 0 0 • view
so this is because there's a tax break now for R&D spending, so everything you can classify as R&D you want to claim as R&D even if it's just looking up the manual
jul 28, 2025, 8:18 pm • 11 0 • view
don't patent holders already pay taxes on successful patents? charging based on the potential value of the patent seems stifling.
jul 28, 2025, 7:44 pm • 0 0 • view
I disagree. I think it would kill innovation.
jul 28, 2025, 7:37 pm • 6 0 • view
there's a fine line between fostering innovation and creating an entire sector of your economy devoted to rent-seeking.
jul 28, 2025, 7:38 pm • 16 0 • view
But wouldn't this just make the government the #1 rent seeker?
jul 28, 2025, 7:40 pm • 6 0 • view
Intellectual property ownership does not always foster innovation (see: patent trolls). If the ongoing cost of the government-provided monopoly was tied to the value of the idea, patent trolls would go extinct. Harberger taxation! arpitrage.substack.com/p/a-harberge...
jul 28, 2025, 8:06 pm • 1 0 • view
Pretty easy to imagine a scenario where a well-connected player makes a game of having the government force the sale of a company's patents. Just trading one monster for another. And of course, since this is a Trump administration proposal, this monster will be worse than you can imagine.
jul 28, 2025, 11:32 pm • 0 0 • view
What’s the mechanism of harm here? You have a patent that’s worth $x, and a company pays you $x for it. You now have money instead of a patent. The company now owns the patent and pays the licensing fee instead of you.
jul 28, 2025, 11:41 pm • 0 0 • view
If this transfer causes you more than $x harm, then the patent was actually worth more than $x, right?
jul 28, 2025, 11:42 pm • 0 0 • view
Company A: We made this neat invention and we want to use it. Company B: We want to buy the patent from you. Company A: I don't want to sell my patent. Company B: The government insists you sell your patent to us. Company A: What? Company B: We are suing you for violation of our patent.
jul 29, 2025, 12:03 am • 0 0 • view
You think you've discovered a secret strategy that automatically will eliminate waste and corruption. I'm sorry to say, you have not. You've just changed the parameters and it will quickly be gamed in ways you aren't really willing to consider.
jul 29, 2025, 12:05 am • 0 0 • view
What? I think you’re reading things that aren’t present in my words. If Company A is a patent troll and Company B is productive, this is a good outcome. If Company A values the patent at what it’s worth, now they have its worth in dollars instead of in an illiquid patent they’re paying fees on.
jul 29, 2025, 12:15 am • 0 0 • view
Innovation will be fine. This will just kill patents.
jul 28, 2025, 7:38 pm • 0 0 • view
Real danger at those sorts of prices tho you're going to kill off individual and small innovators without really constraining patent abuse by large firms tho
jul 28, 2025, 7:51 pm • 66 0 • view
IDK, I think there's a lot of different outcomes, just not enough detail to know yet whether it's good or bad.
jul 28, 2025, 7:51 pm • 27 0 • view
Would obv want to see the details, but just that patents are one of the few ways a very small company can make products in a domain a very large company exists in without the very large one just demolishing the small one in an afternoon by replicating their products
jul 28, 2025, 7:54 pm • 42 0 • view
This….. It’s terrible for small biz innovators and will likely harm future innovations. Dumb idea. Not surprised they came up with it. These idiots want to tax creators/innovators and not Wall St
jul 28, 2025, 9:47 pm • 0 0 • view
if it’s truly novel and worthwhile in market the first mover advantage matters more than patent most often… spurious litigation is already rampant by entrenched actors (from what i recall of my thesis on ip law and innovation)
jul 28, 2025, 7:57 pm • 0 0 • view
seems like this would be a good revenue generator on large firms who generate patents and acquire them defensively, litigate aggressively, and tend to hold back innovation and small actors in practice already. And *maybe* disincentivize that behavior a bit
jul 28, 2025, 7:59 pm • 0 0 • view
Depends how upstream the research is. But patents are often real costs for new market entrants before you have revenue
jul 28, 2025, 8:00 pm • 3 0 • view
yeah fair, also no idea how VC has impacted this space in time since I was reading the research / lit 15+ years ago
jul 28, 2025, 8:01 pm • 0 0 • view
Yes. Though I'm not sure a 5% rate would be punitive even for smaller firms.
jul 28, 2025, 7:55 pm • 8 0 • view
So I get jumpy when people try and fix the patent troll problem by trying to make getting patents very expensive or hard.
jul 28, 2025, 7:55 pm • 31 0 • view
Would a partial solve for this be a tax break/credit for small firms?
jul 28, 2025, 9:25 pm • 0 0 • view
Sounds like what this does is create a mortgage market for ideas.
jul 28, 2025, 8:05 pm • 0 0 • view
Also simultaneously gutting govt scientific knowledge base. Need to increase public sector funding of innovation on the front end to reduce patent abuse and build publicly accessible and available tech. This is just tariffs on American tech companies and it’ll raise prices and reduce competition.
jul 28, 2025, 7:56 pm • 0 0 • view
It could be sorted out, almost like tax brackets.
jul 28, 2025, 8:04 pm • 0 0 • view
Collecting on a patent involves spending tens of millions of dollars in litigation. Will the valuation take that into account?
jul 28, 2025, 8:10 pm • 0 0 • view
a bunch of empty conference rooms in Longview, Texas would like to have a word
jul 28, 2025, 8:38 pm • 0 0 • view
It's great for things like post-it notes but not so good for medical advances.
jul 28, 2025, 8:15 pm • 1 0 • view
this confuses me how he expects to make things domestically then punishes people who try to invent? two main points: 1. patents apply to be extended, why not charge huge fees on that since that's the societal drain 2. there's intl patent treaties won't it brain drain to other countries?
jul 28, 2025, 8:33 pm • 1 1 • view
How do you evaluate the value of a patent?
jul 28, 2025, 7:44 pm • 13 0 • view
To begin, you may look at databases that include publicly-disclosed patent licenses & the fees associated with those licenses.
jul 28, 2025, 9:15 pm • 0 0 • view
I've got over 20 patents. At my former company after we have an idea that could be patented we either: 1. Filed the patent 2. Published it openly so it was prior art (so no one could patent it) 3. Keep it as a trade secret (hope for the best) This proposal would result in a lot more trade secrets.
jul 29, 2025, 2:03 am • 0 0 • view
Yeah this is honestly pretty progressive. It’s a smart way to tie revenue to economic activity and have the most productive ideas pay back into public services potentially. I’d maybe have that value tax kick in only after $500k or something tho
jul 28, 2025, 7:56 pm • 0 0 • view
There's a pretty well established mechanism by which a society efficiently pays for abstract things that provide longterm gains. It's not by nickle-and-diming at the point of contact.
jul 28, 2025, 7:39 pm • 11 0 • view
Interesting idea, never thought about this before. There's a lot of issues with the patent process. Not sure if this solves it.
jul 28, 2025, 8:00 pm • 1 0 • view
In other words, Trump wants his taste.
jul 29, 2025, 9:58 pm • 0 0 • view
Sorry not a fan of communism. Forcing companies in a free market to give 5% of their income from ideas they developed will kill innovation.
jul 28, 2025, 8:10 pm • 5 0 • view
they already have to do this? If corporate income is due to patent royalties, the corporate income tax has this function This might have fewer loopholes
jul 28, 2025, 8:38 pm • 1 0 • view
This is yet another tax on consumers as companies will raise prices by 5% to offset these cost. Just more crap built into the system to pay for massive Republican deficits.
jul 28, 2025, 8:48 pm • 1 0 • view
It does seem ironic that they think a 1-2% tax on wealth is somehow more corrosive/disincentivizing than giving away at 5% royalty on revenue (not profit) from IP derived from extensive R&D and innovation.
jul 28, 2025, 8:35 pm • 4 0 • view
I have over 40 patents, big insurance company. None are in production. I imagine this will have a huge chilling effect on innovation
jul 28, 2025, 8:38 pm • 1 0 • view
I’ve long thought holding patents should invoke a Harberger tax. Let the patent filer self-declare value, give 5-years to bring to market, and then start charging an escalating % of self-assessed value.
jul 28, 2025, 8:20 pm • 0 0 • view
I’d actually seen this idea kicked around as a Georgist idea. Sort of self assessed LVT but for IP
jul 28, 2025, 8:01 pm • 1 0 • view
Harberger tax! en.m.wikipedia.org/wiki/Harberg...
jul 28, 2025, 8:21 pm • 2 0 • view
chicagounbound.uchicago.edu/cgi/viewcont... chicagounbound.uchicago.edu/cgi/viewcont...
jul 28, 2025, 8:05 pm • 0 0 • view
Yeah having worked at a number of large tech firms, they're patent machines- a whole process built so if anyone in the company wanted to get a patent on something they would facilitate. Its bananas.
jul 28, 2025, 7:57 pm • 0 0 • view