Thinking Outside the (Patent) Box: An Intellectual Property Approach to Combating International Tax Avoidance

In light of the corporate tax cuts—included in the Tax Cuts and Jobs Act (TCJA)—Andrew Hwang examines global tax avoidance schemes that are likely to remain pervasive among multinational corporations and proposes policy tools to curb these practices. Thinking Outside the (Patent) Box: An Intellectual Property Approach to Combating International Tax Avoidance explores the intersections of the U.S. tax and intellectual property (IP) regimes to curb tax avoidance practices exploited by some of the largest and most profitable multinational corporations, which cost the U.S. government upwards of $111 billion per year in lost revenue. The paper highlights how IP policy is an underutilized and powerful policy lever to deter these extractive and unproductive activities. If policymakers are truly committed to building a progressive corporate tax system that encourages innovation, productivity, investment, and job creation, they should look to both tax and IP policies for solutions.