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Tax Loopholes No Longer Patentable

samzenpus posted more than 2 years ago | from the getting-rid-of-stupid dept.

Patents 278

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."

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278 comments

FLAT TAX (2, Insightful)

unixisc (2429386) | more than 2 years ago | (#37477000)

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?

Re:FLAT TAX (0)

unixisc (2429386) | more than 2 years ago | (#37477004)

Forgot to add - no tax loopholes once this is done! And so no patents either!

Re:FLAT TAX (1)

Anonymous Coward | more than 2 years ago | (#37477022)

I can't tell if this is +5 Funny or -1 Ignorant?

Re:FLAT TAX (1)

rtfa-troll (1340807) | more than 2 years ago | (#37477060)

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.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477114)

You do realize that very few people just put their money under a mattress, right? Even money in bank accounts is mostly used to invest.

Re:FLAT TAX (1)

rtfa-troll (1340807) | more than 2 years ago | (#37477150)

I'm not sure how that's relevant to my comment. This is good. They will have more wealth to pay taxes on. At the same time they will have more wealth to be happy with. This would be actively encouraged by a system in which wealth was flat taxed.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477200)

Because you implied that their wealth isn't benefiting society at all, which is ridiculous. In fact what your idea would encourage is people keeping their wealth off the books, which is only easy if it's in the form of cash or precious metals, in which case it does do absolutely nothing.

Re:FLAT TAX (1)

El Torico (732160) | more than 2 years ago | (#37477470)

Because you implied that their wealth isn't benefiting society at all, which is ridiculous. In fact what your idea would encourage is people keeping their wealth off the books, which is only easy if it's in the form of cash or precious metals, in which case it does do absolutely nothing.

Oddly enough, that's what's currently happening. Anyone who does have cash is holding on to it or investing in gold.

Re:FLAT TAX (1)

rtfa-troll (1340807) | more than 2 years ago | (#37477682)

No I didn't. At most I implied that their wealth was benefitting society relatively less than the equivalent amount of wealth in the hands of poorer people, but that point of view would be irrelevant to what I said. What I actually said was that these people cost society much more than poor people. What I would go on further to say is that they aren't mostly willing to pay their way with Warren Buffet appearing to be an honourable exception.

Generally, however; I'm not totally convinced by any flat tax. There is real logic to having rates which vary according to e.g. income or wealth levels. However, the original post seems to suggest that a flat rate of tax would be obviously fair. I'm suggesting that there are other positions, closer to taxing wealth, which would be much fairer.

Re:FLAT TAX (1)

jonbryce (703250) | more than 2 years ago | (#37477580)

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

Re:FLAT TAX (3, Insightful)

snowgirl (978879) | more than 2 years ago | (#37477092)

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.

Re:FLAT TAX (0, Flamebait)

unixisc (2429386) | more than 2 years ago | (#37477120)

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000? $2,000,000? Incidentally, good job with the class envy & the scare mongering.

Re:FLAT TAX (3, Insightful)

jpapon (1877296) | more than 2 years ago | (#37477154)

The person making $12,000 pays a much higher percentage of their income in sales tax than a rich person does.

And what's with this class envy nonsense? Does Buffett have class envy because he thinks the rich should pay more income tax?

Those making millions make those millions due to their own hard work, sure, but they also make them thanks to the infrastructure, security, and educational system maintained by the government, the poor, and the middle class. They should have to pay their 30+%, since they benefit from the government more then anyone else. Without government to defend them and maintain order, the rich would quickly become very poor.

Re:FLAT TAX (-1, Flamebait)

unixisc (2429386) | more than 2 years ago | (#37477254)

But that's true whenever anybody pays for anything. When you buy, say, a car, you are automatically paying a much higher percentage of your income on the car than Buffet is. And whoever said anything about Buffet having class envy - I'm saying that those who expect people w/ higher incomes to pay more have class envy, regardless of what they're actually earning. It's the attitude that qualifies it.

Statistically, it's been demonstrated that the top 5% of all income earners pay 50% of all taxes, while the bottom 70% pay less than 5% of all taxes. And it's not even like the top 5% has 50% of all the income/wealth, however one wants to see it - it's more like 20%. Also, your statement that without the government defending them, the rich would quickly become poor, you're suggesting that the government is/should be an extortion racket, like the mafia.

Re:FLAT TAX (3, Informative)

snowgirl (978879) | more than 2 years ago | (#37477276)

What world do you live in?

In the United States at the end of 2001, 10% of the population owned 71% of the wealth and the top 1% owned 38%. On the other hand, the bottom 40% owned less than 1% of the nation's wealth.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477378)

GP said "income/wealth," but meant "income," since we are taxed on income, and not on our ability to save and invest money.

Re:FLAT TAX (1)

snowgirl (978879) | more than 2 years ago | (#37477418)

GP said "income/wealth," but meant "income," since we are taxed on income, and not on our ability to save and invest money.

Capital gains aren't taxed? Funny, I seem to hear about the rich complaining about that tax a lot...

Re:FLAT TAX (2)

Daniel Dvorkin (106857) | more than 2 years ago | (#37477366)

I'm saying that those who expect people w/ higher incomes to pay more have class envy, regardless of what they're actually earning. It's the attitude that qualifies it.

Or maybe you don't understand other people's thinking nearly as well as you think you do.

Statistically, it's been demonstrated that the top 5% of all income earners pay 50% of all taxes, while the bottom 70% pay less than 5% of all taxes. And it's not even like the top 5% has 50% of all the income/wealth, however one wants to see it - it's more like 20%.

Any time you start a statement with "Statistically ...", you'd better be ready to back up your claims with something more than a bunch of hand-wavey numbers. Speaking as a statistician, I'd like to see your sources and your methodology. If you have any.

Also, your statement that without the government defending them, the rich would quickly become poor, you're suggesting that the government is/should be an extortion racket, like the mafia.

Um, no, he's describing the way the world works. Without effective government, out-and-out extortion rackets -- with all of the government's power and ruthlessness, but without even its minimal answerability to the people -- take over. One thing that liberals and conservatives can generally agree on is that one of the main purposes of government is to keep people who want to kill you and take your stuff from doing so; and obviously, the rich have a lot more to take. Are you seriously arguing with this proposition?

Re:FLAT TAX (1)

mcgrew (92797) | more than 2 years ago | (#37477614)

Those making millions make those millions due to their own hard work,

Many do, many don't, but all rich people's wealth was generated by others' labor. Sam Walton could not have gotten rich without an army of low-paid workers. That idiot Donald Trump could have never become rich without being born into wealth.

Re:FLAT TAX (2)

snowgirl (978879) | more than 2 years ago | (#37477202)

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000? $2,000,000? Incidentally, good job with the class envy & the scare mongering.

A person making $12,000 a year is likely buying their $2 bottle of coke on foodstamps provided by the government in the first place. So, really, they're paying about $0 for a bottle of coke out of their income.

And this "class envy" that you purpose is not an imagined thing, nor an opinion. What happens to people who cannot pay taxes? Oh yeah, they rack up a bill so high that they can't pay it, and eventually either settle for something that they can pay, or end up in jail for tax evasion. So, let me ask you, if your scheme were implemented, and set at $1,000 a year, which I am entirely unable to currently pay, at what point would the government decide to just jail me for failure to pay my taxes? Or would I get a special "poor person" dispensation because I'm entirely incapable of paying the taxes because I have no income?

I mean, the $2 bottle of coke that I'm buying was bought through government funds, but I can't very well pay my $1,000 a year in foodstamps, because it's not food. Then again, if my foodstamps run out, guess what? I can't and don't buy any more coke. Of course, foodstamps also don't buy DVDs, alcohol, or new clothes... guess which items I don't buy at all? I don't hardly have the choice of not paying taxes by not using any services at all. I can't exactly exempt out of police protection in order to reduce my tax burden.

That's why the whole analogy of taxes to a contract for the purchase of physical goods fails. Physical goods can be bought in varying amounts according to affordability, while social programs are often provided to those people who can least afford to actually pay for those services. Providing social services only to those people who can best afford to pay for those services would kind of defeat the purpose of helping the poor... because only the rich would be getting the benefits.

Re:FLAT TAX (0)

unixisc (2429386) | more than 2 years ago | (#37477334)

People who cannot pay their taxes would obviously have that in their debt, just like current taxpayers who are either late or default. I'm against taxpayers being sent to jail, since it's not a violent crime. Let's say taxes were capped @ $1000, then, assuming a taxpaying population of 200m, you'd have a total inflow of $200b. That should force the government to stop pretending that it has trillions to spend on anything, be it social programs or wars or nation-building exercises in Afghanistan, Pakistan, Egypt or Iraq.

The taxes are not a price tag for social programs even today, given that the rich 'pay for services' that only they'll probably never touch. It's more the price of citizenship. Nobody can live on $1000 a year or even close, unless one lives under a bridge. But allowing for a person w/ a normal income, one would easily pay off the $1000 tax every year, and then get to do w/ the balance what one chooses/needs. Yeah, people do have the option of deciding how much of something they want to buy. With taxes, they don't get to pick that, but to base that on either their income or wealth is a disincentive for them being either high-earning or rich. Just give everybody a tab of $____ and you won't have any of those tax loopholes, patents on tax loopholes, or any headaches associated with any financial transaction you underwent. Just owe and pay government your $____ by April 15th, and don't worry about it the end of the year.

Re:FLAT TAX (2)

snowgirl (978879) | more than 2 years ago | (#37477412)

Right, no one could possibly live off of $1000 a year. You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income. I don't live under a bridge (because I have carrying friends and family, who wouldn't let that happen), and get food entirely through foodstamps.

Your solution sounds so great, because it is so simple, but fact is that it will not actually work. It fundamentally punishes people for being poor, which is generally beyond their power to control. And it completely discards this idea that society has called "charity". Poor people's lives suck bad enough, why do you have to drop the same burden on them as those who are rich?

And we should reward people for hording cash like dragons? You do realize that people grabbing at cash any which way they possibly can has been the cause of every bubble, depression, and recession that we have ever had, right? It's why we can't trust employers to treat their employees better than slaves, and provide a safe work environment without oversight. Really, why should we be encouraging people to be greedy heartless bastards? Rich, sure, that's fine, but it bring with it social responsibilities to the society that has rested such confidence with an individual.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477524)

Right, no one could possibly live off of $1000 a year. You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income. I don't live under a bridge (because I have carrying friends and family, who wouldn't let that happen), and get food entirely through foodstamps...

You've never earned anything other than food stamps? Seriously? How much longer do you expect your "carrying" friends and family to continue doing so?

Re:FLAT TAX (-1)

Anonymous Coward | more than 2 years ago | (#37477692)

She doesn't. She expect government to do all that 'carrying', so that her friends and family don't have to. Sure, she could earn a living working, say, in a store, but that's a lot less fun than promoting socialism in the USA.

Re:FLAT TAX (1)

TheRaven64 (641858) | more than 2 years ago | (#37477560)

You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income

I think this sentence needs some clarification.

Re:FLAT TAX (1)

snowgirl (978879) | more than 2 years ago | (#37477792)

You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income

I think this sentence needs some clarification.

Over the previous year.

Re:FLAT TAX (1)

TheRaven64 (641858) | more than 2 years ago | (#37477814)

Because...

(Although, if you display this kind of communication skill on your CV and in interviews, no further explanation is necessary...)

Re:FLAT TAX (1)

mcgrew (92797) | more than 2 years ago | (#37477658)

With taxes, they don't get to pick that, but to base that on either their income or wealth is a disincentive for them being either high-earning or rich.

That's the dumbest thing I've seen all week. "What? I can't have ten bottles of coke, I can only have nine? Screw that, I'll go thirsty!"

Unfortunate that so many people are idiotic enough to believe that stupid lie.

Re:FLAT TAX (1)

unixisc (2429386) | more than 2 years ago | (#37477834)

Stupid analogy. It's more like a person who earns above a certain threshold finding himself in a tax bracket that forces him to make a bunch of choices:

1. Quit that job, and go for a less stressful, lower paying one

2. Move your money/business offshore

3. Close down the business if #2 is unaffordable as well

You're also underestimating the magnitude of the effect of taxes. If taxes were just 10%, which your analogy seems to imply, there'd not be a problem. The reason it is a problem is that it's ~30% for the bracket we're discussing. And that's just federal - I'm not even counting state, local and other taxes.

Re:FLAT TAX (1)

TheVelvetFlamebait (986083) | more than 2 years ago | (#37477250)

No, Bill Gates should pay absolutely nothing, because if Bill Gates had attempted to make his empire while paying a flat tax, he would be now flat broke, and most probably swinging from roof beam by the neck.

Re:FLAT TAX (1)

mwvdlee (775178) | more than 2 years ago | (#37477474)

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000? $2,000,000?

Gates would pay $2, the poor person would drink a $0.05 glass of water.
Nobody is forcing you to buy coke bottles, but government IS forcing you to pay tax.

Re:FLAT TAX (2)

mcgrew (92797) | more than 2 years ago | (#37477588)

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000

Actually, that's how it is now. Rich people pay $5 for a cup of Starbucks coffee, the middle class $1 for McDonalds, the poor five cents for Folgers.

The rich buy a Lamborghini, middle class a Chevy, the poor get a ten year old beater (or take the bus).

I can't tell if you're trolling or just stupid.

Re:FLAT TAX (0)

unixisc (2429386) | more than 2 years ago | (#37477742)

We're talking about paying for identical things. Regardless of whether a millionaire or the homeless guy on a park bench walked into a store, they'd both have to pay $2 for the coke. Whether they choose to buy coke or not in the first place is a different matter altogether. If you're spending the same amount of money for the same things in daily life, I don't see why it should be any different w/ taxes.

I'm not trolling: I genuinely support the Flat Tax on the basis of principle. Our socialist friend may think it's the job of government to redistribute income so that nobody can hoard their money, but I believe that once it's your money, whether you spend it on a Lamborghini or a Cray or a Gulfstream or scatter it all from a plane or bury it in your cellar is nobody else's business but yours. You're welcome to think it's stupid, but I don't see the difference b/w charging people based on their income/wealth, vs Lenin's 'From each according to his abilities, to each according to his needs'.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477134)

This is Slashdot. Don't you know that the rich deserve every penny that they have, and the poor CHOSE to be that way?

Re:FLAT TAX (1)

Chrisq (894406) | more than 2 years ago | (#37477326)

This is Slashdot. Don't you know that the rich deserve every penny that they have, and the poor CHOSE to be that way?

Right, so they deserve to be imprisoned if they don't pay the $13,000 each [outsidethebeltway.com] in tax that the flat rate would have to be to maintain current levels of revenue. The above figure assumes that children are also paying - after all they did decide whether or not to be born into a wealthy family.

Re:FLAT TAX (0)

unixisc (2429386) | more than 2 years ago | (#37477346)

It's the other way around - most people on /. are unapologetic Leftists, so there's not a whole lot of support there for the 'rich'.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477252)

I like the cut of your jib, send me your resume and I can get you a job writing for Fox News.

Re:FLAT TAX (1)

snowgirl (978879) | more than 2 years ago | (#37477282)

I like the cut of your jib, send me your resume and I can get you a job writing for Fox News.

Since when does Fox News argue for poor people? I would make a horrible contributor at Fox News, particularly owing to being a member of the Socialist Party USA.

I think you're too moderate (1)

Chrisq (894406) | more than 2 years ago | (#37477342)

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?

Re:I think you're too moderate (1)

snowgirl (978879) | more than 2 years ago | (#37477448)

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 experience. You know, because they're earning money from other people's labors...

Re:I think you're too moderate (2)

cbope (130292) | more than 2 years ago | (#37477664)

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 of people living below the poverty line in the US is shocking given that it's supposed to be a rich nation.

Re:FLAT TAX (1)

migla (1099771) | more than 2 years ago | (#37477094)

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.

Re:FLAT TAX (1)

Joce640k (829181) | more than 2 years ago | (#37477158)

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.

Re:FLAT TAX (1)

slippyblade (962288) | more than 2 years ago | (#37477228)

Except that poor people pay much more in sales tax as a percent of income than a rich person. Sales tax is on a regressive scale. The more an item costs, the lower the sales tax on the item is. Cars are a good example. Where I live you pay, for example, 9% sales tax up to $5000. Anything over that $5k is taxed at 2%. So if I buy a 5000 car, I pay 9%. But if a rich person buys a $100k car he pays a SIGNIFICANTLY lower overall percentage. There are LOTS of nifty things like that.

Re:FLAT TAX (1)

mwvdlee (775178) | more than 2 years ago | (#37477534)

How about a fixed percentage sales tax then? Not "more expensive, less percentage", but every product has the same percentage of tax. Perhaps give living essentials (i.e. milk, bread) a lower tax product, but anything not strictly essential to stay alive a fixed tax.
This is how most of europe handles sales tax already.
In my country (Netherlands) I pay about 20% on luxury goods (whether it's shoes or a jet airplane) and 6% on essential goods (which doesn't even include luxury food articles). There are some additional taxes for legal drugs like alcohol and tobacco, but that's pretty much it. AFAIK, most countries in europe have a similar system with 2 or 3 levels of sales tax.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477390)

I would be curious to see anybody on here argue against abolishing income taxes and doing it all via sales tax.

slippyblade states that sales tax is on a regressive scale. WE ARE NOT TALKING ABOUT THAT SLIPPY.

We are talking about a flat sales tax -- the more you spend the more tax you pay. Let's see anybody here argue that this is not a better system and that income tax should not be abolished.

Re:FLAT TAX (3, Interesting)

rtfa-troll (1340807) | more than 2 years ago | (#37477782)

The rich actually spend proportionally much less. E.g. if you have your own estate, with your own servants and your own cooks, you have food cooked for you based on local produce. This makes a meal which would cost hundreds of dollars per person but, since it's all your own property, you don't buy it and so you don't pay sales tax.

If you or I go on holiday, we go to some resort where we pay for everything; every little bit of water you use ends up being taxed. When Richard Branson goes on holiday he flys in his own jet to his own island and the only sales taxable expense is his jet fuel. When his rich friends do the same they go to his island sometimes, and he comes to their islands in exchange other times. In a sense this is completely fair. I would get annoyed if you tried to tax me for having friends over for dinner rather than going to a restaurant, but the scale of the thing means that in the end, the really rich show much less income compared to the resources they use than you or I and pay even less tax.

Re:FLAT TAX (1)

Registered Coward v2 (447531) | more than 2 years ago | (#37477410)

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.

Re:FLAT TAX (1)

unixisc (2429386) | more than 2 years ago | (#37477428)

I didn't get into whether the tax should be income, wealth or sales tax. For sales tax, a percentage is unavoidable, but if one just implements the principle that taxes are the membership fees for citizenship, then the flat rate is the way to go. But I'm not completely against the sales tax either. But I can see all Leftists recoil @ the idea of misers dodging the tax.

Re:FLAT TAX (0)

Anonymous Coward | more than 2 years ago | (#37477316)

You are right, it's not different at all.
You are right and you are brilliant. You should go a million little miles away and shine on us.

Re:FLAT TAX (1)

mwvdlee (775178) | more than 2 years ago | (#37477458)

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?

Re:FLAT TAX (1)

Your.Master (1088569) | more than 2 years ago | (#37477626)

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 bottles of coke...

Re:FLAT TAX (1)

unixisc (2429386) | more than 2 years ago | (#37477854)

Different stores can have different prices for the same item. What I'm questioning is whether any particular store can legally charge different prices to different people based on anything - their income levels, race, ethnicity, et al. Yeah, 2 different stores, even belonging to the same chain, can vary in price. But if I and another customer @ the same shop are buying the same quantities of the same item, is it legal to give me a better price than the other customer?

The fact that tax loopholes were patentable (5, Insightful)

mehrotra.akash (1539473) | more than 2 years ago | (#37477002)

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

Re:The fact that tax loopholes were patentable (0)

Anonymous Coward | more than 2 years ago | (#37477032)

And the thing that divides my brain by zero is that allowing these "business methods" to be patentable would probably help to disclose and limit the propagation of such loopholes, possibly having a net positive effect on society D:

Re:The fact that tax loopholes were patentable (3, Interesting)

Plunky (929104) | more than 2 years ago | (#37477206)

In fact the government should take a tip from open source and offer bounties for tax loopholes.. pay the discoverer a set fee (or percentage of estimated revenue!) then close it.

Re:The fact that tax loopholes were patentable (1)

Joce640k (829181) | more than 2 years ago | (#37477136)

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...

Re:The fact that tax loopholes were patentable (1)

king neckbeard (1801738) | more than 2 years ago | (#37477176)

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.

Re:The fact that tax loopholes were patentable (1)

kcbnac (854015) | more than 2 years ago | (#37477180)

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...

Re:The fact that tax loopholes were patentable (0)

Anonymous Coward | more than 2 years ago | (#37477166)

During the 70s in the UK, there was a quite high profile case of an architect (poulson) bribing local government officers to have planning requests passed, building funded etc.

One of the reasons he was found out, was that he kept records for tax purposes - he was claiming tax back on the brides.

The Inland Revenue witness basically stood up and said it was a legitimate business expense and tax could be claimed back.

Just shows how tax mens morals are messed up ...

Re:The fact that tax loopholes were patentable (0)

Anonymous Coward | more than 2 years ago | (#37477302)

One of the reasons he was found out, was that he kept records for tax purposes - he was claiming tax back on the brides.

He was claiming tax back on the brides? I wish I could do that - mine is costing me a fortune!

Re:The fact that tax loopholes were patentable (0)

Anonymous Coward | more than 2 years ago | (#37477242)

I thought there was some court case a while back where the tax-patent was deemed unenforceable since it deprived other people of the due process of law.

Which IMO makes a hell of a lot of sense: Nobody should be able to patent "A method for reducing the odds of conviction" which involves "staying silent when arrested", for example.

Re:The fact that tax loopholes were patentable (1)

roman_mir (125474) | more than 2 years ago | (#37477320)

As I always say: patents must be abolished (and I get nasty replies for that [slashdot.org] )

But here are you go, one more reason to abolish patents.

As to tax loopholes - AFAIC the more, the merrier, but one place where loopholes really need to be eliminated is in the law that applies to government - Constitution. Government shouldn't be able to find loopholes in the law that applies to it, or then you find yourself at the wrong side of the gun, when president says: you are a possible terrorist, so we must kill you with a drone strike (or however else.)

But paying less taxes is everybody's duty and responsibility. It's because government that is given money destroys the economy (my argument here) [slashdot.org] .

Any amount of money that becomes available to the government above the minimum amount that needs to be used for the bare minimum of functions that government is authorized to do ends up hurting the economy.

Of-course the problem is government redefines what money is and then it just prints the hell out of it. [slashdot.org]

So patents on loopholes are obviously damaging to the economy, as they may be used to prevent people using the loopholes appropriately and it's just one more reason to abolish the patent system.

Re:The fact that tax loopholes were patentable (1)

Chardansearavitriol (1946886) | more than 2 years ago | (#37477696)

You can also patent mathematical formulas (with varying degrees of success) and the DNA of lifeforms. Oh, and im pretty sure amazon patented forks the other day. I may be wrong.

Re:The fact that tax loopholes were patentable (1)

ChinggisK (1133009) | more than 2 years ago | (#37477816)

Someone should just patent getting a patent, patent trolling, and patent warring and be done with it.

Well, there goes a way to get rid of tax loopholes (2)

LordNacho (1909280) | more than 2 years ago | (#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.

Re:Well, there goes a way to get rid of tax loopho (0)

Anonymous Coward | more than 2 years ago | (#37477208)

not remotely surprised, this is one of the more obvious ironic fails.
the us Gov has an endless store of examples of ffundemental failure.

war on drugs - orrganized crime gets rich, common man goes to jail.
no child left behind - educations standards lowered.
reduced tax's on rich to stimulate jobs - common man cant consume,
                                                                                                                    therefore no effect in america.

on and on. It is abundantly clear you guys in the states do not actually
have a democracy.

Re:Well, there goes a way to get rid of tax loopho (1)

shish (588640) | more than 2 years ago | (#37477420)

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.

let's exapand this to all law... (3, Insightful)

vkt-tje (259058) | more than 2 years ago | (#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.

Re:let's exapand this to all law... (1)

StripedCow (776465) | more than 2 years ago | (#37477080)

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.

Re:let's exapand this to all law... (1)

Custard Horse (1527495) | more than 2 years ago | (#37477132)

Lawyers definitely run the world and they own all money. Worship your new legal overlords.

Alternatively, you could get your head out of your ass and make a difference instead of passing the blame onto somebody else.

(cue the argument about one person not being able to make a difference)

Re:let's exapand this to all law... (0)

Anonymous Coward | more than 2 years ago | (#37477332)

Dammit! One person can't make a difference!

Re:let's exapand this to all law... (1)

mehrotra.akash (1539473) | more than 2 years ago | (#37477164)

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!!

Re:let's exapand this to all law... (1)

Chrisq (894406) | more than 2 years ago | (#37477352)

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.

Re:let's exapand this to all law... (0)

Anonymous Coward | more than 2 years ago | (#37477178)

Because there is no prior art and it isn't obvious to stop at a red light (not that that would stop the USTPO from awarding you the patent). Not that tax evasion patents are a good idea (actually, they might be: They make it more expensive to use the strategies patented, and makes them easier for lawmakers to find. That is good, based on the premise that lawmakers will try to minimise tax evasion, which is probably naive, but at least it also makes it more transparent), but you need a better analogy.

Don't stand between a congressman and your taxes (2)

CuteSteveJobs (1343851) | more than 2 years ago | (#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!

Re:Don't stand between a congressman and your taxe (3, Interesting)

snowgirl (978879) | more than 2 years ago | (#37477128)

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.

Re:Don't stand between a congressman and your taxe (1)

am 2k (217885) | more than 2 years ago | (#37477300)

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.

Re:Don't stand between a congressman and your taxe (1)

snowgirl (978879) | more than 2 years ago | (#37477344)

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 self-contained pistol cartridge was a huge deal, and put the developer ahead in sales enormously for a long time until the patent expired. However, of course, the self-contained pistol cartridge wasn't worthless when its patent expired, and so it became ubiquitous once the patent expired. God, how often do we hear of a patent in computers expiring and every is in a rush to reproduce it generically.... :(

Re:Don't stand between a congressman and your taxe (1)

am 2k (217885) | more than 2 years ago | (#37477388)

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.

Re:Don't stand between a congressman and your taxe (1)

snowgirl (978879) | more than 2 years ago | (#37477430)

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...

Re:Don't stand between a congressman and your taxe (1)

am 2k (217885) | more than 2 years ago | (#37477494)

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

Re:Don't stand between a congressman and your taxe (2)

Daniel Dvorkin (106857) | more than 2 years ago | (#37477318)

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 patents on things like software, accounting tricks, and DNA sequences that we run into trouble, and go far beyond what the people who wrote those words ever intended.

Re:Don't stand between a congressman and your taxe (2)

snowgirl (978879) | more than 2 years ago | (#37477380)

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 know, because Family Matters and a number of organizations opposing gay marriage seem intent on declaring that the original purpose of marriage was to sanctify the union of a single man, and single woman, even though quite clearly we understand that marriage developed fluidly and dynamically out of cultures, and was more about assurance of parentage and legitimacy of children, as well as political partnerships, etc... hell, this "one man and one woman because of love" idea is quite a new "redefinition of marriage" itself.

Don't get rid of the loopholes - license them! (1)

Anonymous Coward | more than 2 years ago | (#37477090)

The problem with getting rid of tax loopholes is that this suddenly puts thousands of tax lawyers out of a job - and in any economy, putting a section of the workforce (no matter how despicable) is always a bad thing...

So, instead, the US government should take ownership of all the patents of tax loopholes, and license them to the lawyers for a fee...

The government still gets it's money - just has to license the loophole at 90% of whatever it saves.
The lawyers are still in work - they can tell the client "I can get you out of 10% of your tax liability"
The overly rich clients are still happy - they're still saving compared to paying the full amount of the debt

The only person who loses out is the one who had the patent in the first place...

Re:Don't get rid of the loopholes - license them! (1)

malkavian (9512) | more than 2 years ago | (#37477122)

No, it doesn't put them out of a job. And where it does, the money stays in companies that are trying to innovate. For each lawyer that leaves employment, you'll probably have 10 more in productive companies that don't lose their job as their company doesn't get bogged down in a legal mire over spurious claims.
If some part of the system is broken (and it is), fix it. This may be the first of the cracks in the "Business Process" patent crap tht starts the path to getting the ridiculously inappropriate software patents fixed.

Re:Don't get rid of the loopholes - license them! (0)

Anonymous Coward | more than 2 years ago | (#37477224)

I have a feeling I will hear a whooshing sound in a minute, but:
Putting a section of the workforce that does no usable work out of work is a good thing. That this should not be the case is the broken window fallacy. If they are put out of work, some of them will adopt work which is usable, raising the total production of society.

Years ago, I patented Bribery and Corruption (0)

Anonymous Coward | more than 2 years ago | (#37477170)

Now the world will be mine - bwahaaahaaaah

Re:Years ago, I patented Bribery and Corruption (1)

Chrisq (894406) | more than 2 years ago | (#37477360)

Now the world will be mine - bwahaaahaaaah

I'm sure people will have difficulty finding prior art on that one....

Re:Years ago, I patented Bribery and Corruption (1)

unixisc (2429386) | more than 2 years ago | (#37477372)

You remind me of the Dogbert Static Network [dilbert.com]

A suggestion (1)

gzipped_tar (1151931) | more than 2 years ago | (#37477186)

We all know that patents are an innovation booster. You don't want to stifle innovation, do you? Then just introduce a "tax loophole tax" that tax the very action of evading tax.

You dawg..

Humorous. (2)

RightSaidFred99 (874576) | more than 2 years ago | (#37477204)

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.

omg (2)

X10 (186866) | more than 2 years ago | (#37477238)

"Tax Loopholes No Longer Patentable"

OMG.

please, make it stop (1)

joss (1346) | more than 2 years ago | (#37477374)

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.

Why not outlaw tax loop holes (0)

Anonymous Coward | more than 2 years ago | (#37477424)

In Sweden we have outlawed tax loop holes (or almost all of them), simple as that.

Any transactions that don't have any other purpose then avoiding taxes can simply be ignored by the Swedish Tax Agency. There are only one law needed to plug such tax loop holes, that a set of business transactions must have an explainable purpose (other then avoiding taxes).

Occasionally (but very rarely), the Swedish Tax Agency make a misjudgement and ignore tax reductions from "real", legitimate transactions. Then the tax payer simply have to explain the practical purpose of the transactions, a five minute telephone call is usually enough. If the tax payer is still denied the tax reductions, then he/she/it can make a written complaint to the Tax Agency and if that is denied, take it to court.

There is of course transactions that give large, sometimes unfair, tax reductions, but also have other practical benefits. If they are (by politicians and tax experts) considered as tax loop holes, they have to be explicitly plugged by laws and regulations (Sweden (and other Nordic countries) don't normally have case laws, if a law or regulation is unclear or have unforeseen ill consequences, it gets rewritten almost immediately, case law only apply until the new, hopefully improved, law or regulation is set into place). Until a law or regulation is put into place to plug such a tax loop hole, the tax payers can use them without any consequences, but such grey zone transactions have proved to be very rare (almost always, a set of transactions are either only made to avoid taxes, or is part of "real" productive business) and as Sweden (as well as other Nordic countries) lack case law, it has instead developed fast, safe and fair procedures to make changes in laws and regulations, so even such tax loop holes get plugged fast.

This is a bad thing! (2)

mlush (620447) | more than 2 years ago | (#37477432)

  • 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.

Treating the symptom instead of the disease (1)

Hentes (2461350) | more than 2 years ago | (#37477480)

While it's nice that they have banned this the fact that certain financial/legal strategies are still patentable in America is ridiculos.

Tax loophole patents are great! (1)

mwvdlee (775178) | more than 2 years ago | (#37477544)

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.

Re:Tax loophole patents are great! (1)

Rich0 (548339) | more than 2 years ago | (#37477746)

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 the most outrageous thing likely to be judged ethical. Ok, so lying to a prospective client to get their business is clearly unethical, but how about just telling them anecdotal examples of the 1% of people who benefited from hiring a lawyer in their situation, and not mentioning the 99% who simply wasted their money when doing so? What if I get somebody else to do the lying for me? And so on...

The results of such a system are predictable - a nation governed by laws that can be hundreds of pages long, which everybody and their uncle then ignores the intent of, producing legal briefs thousands of pages long in the process.

I've even seen this stuff on FOSS projects - somebody breaks some rule governing commits (you name it - QA, coding style, etc), and gets called on it. Then a 100 message flamewar erupts over whether the particular activity does or does not violate some complicated interpretation of the rules, and 300 new rules are proposed to take the place of one. Successful projects resist this, usually by having a benevolent dictator or somebody kick the person out with a one-line reason so that the rest fall into line. That works OK since ultimately even benevolent dictators have limited power in FOSS (forking and competition), but it doesn't work well for government (at least not in the long term).

WTF is this in the first place? (1)

Alex Belits (437) | more than 2 years ago | (#37477798)

If a tax loophole is patented, isn't it the duty of the government to make it illegal, thus making the patent worthless?

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