The taxation of intellectual property is too harsh, and needs to be changed according to Everedge IP chief executive Paul Adams.
Everedge IP takes ideas, or advises any firm with an idea, and helps turn them into money-making products as quickly as possible.
Mr Adams says intellectual property is taxed unfairly because it treats patents as an asset when they are in someone's possession, but taxes them as income when sold.
He says a number of the large accounting firms said they were not aware of the rule in the tax code.
Mr Adams says taxing intellectual property in a way that is inconsistent and disadvantages intellectual property owners will hamper New Zealand from becoming a high value, knowledge based economy.
He says the Government needs to fix this problem, preferably by bringing it in line with the tax treatment for plant and machinery, and goodwill.