Taxing the Trade of the Trade Mark

Abstract

Trade marks generate recognition to businesses by providing and protecting their distinctive features, among others, in a
competitive market. Trade marks, being intangible property, can be transferred to third parties by various modes like
assignment/ transmission/license. Since, trade marks have the potential to be commercially exploited and thereby attract tax
(direct and/or indirect) on its commercial exploitation. This paper highlights the various modes through which trade marks
can be commercialised and the implication under both direct and indirect taxation of such commercialisation. The paper also
discusses recent issues with respect to the taxation of the income generated from the transfer of trade marks.