Patent Box Regimes and Innovation Ecosystem Evaluation Note / Vedantika Bhagat

"Innovation is now understood as one of the main drivers of economic growth by developed and developing economies alike.  Countries are increasingly focused on this pivotal element to address critical social problems such as pollution, health issues, poverty, and unemployment. However, the question remains, which policies can effectively derive innovation in dynamic innovation ecosystems. Patent Box regimes can act as an effective policy initiative to nurture and boost innovation.  A patent box regime is a type of tax incentive aimed to encourage innovation activities through a lower corporate tax on certain levels of income arising from intellectual property. Patent box regimes are back-end incentives that differ from R&D incentives in that they are focused on the efficient output of research.

Patent box regimes are a relatively new tool for governments and have mostly been adopted by countries in the past decade. In this context, the policy note aims to (i) describe the role of patent box regimes in the innovation space; (ii) compare the patent box regimes currently implemented in 5 OECD countries (iii) describes the Turkish current patent box regime (iv) discuss how the patent box can address gaps in Turkey’s innovative capacity and be used to leverage its strengths."

Patent Box Regimes and Innovation Ecosystem