It is said that there are only 2 inevitables in life – death and taxes. Through computer or video games, we escape the harsh realities of life and, only run into “death.” But now, at least in American massively multiplayer online (MMO) games, even the payment of taxes for “virtual transactions” may become another stressful reality!
According to Dan Miller, a senior staff economist for the Joint Economic Committee of the U.S. Congress, they are considering whether the sale of “in-game” goods should be taxed and that they are at 'the preliminary stages of looking at the issue and what kind of public policy questions “virtual economies” raise -- taxes, barter exchanges, property and wealth?" The MMO “Second Life” is cited as an example of a large in-game economy based on the purchase of virtual items like clothing and vehicles, which generates as much as a half million dollars in sales a day.
A congressional report is due to be issued next month (August), and it would be very interesting to see what it contains because the taxation of virtual properties and transactions would mark a milestone in the blurring of distinctions between reality and cyber-reality.
"What that report will say is unknown, as the committee has kept entirely quiet about its thoughts. However, it's clear that something will happen. 'Given growth rates of 10 to 15 percent a month, the question is when, not if, Congress and IRS start paying attention to these issues,' [senior economist Dan] Miller, who is a fan of virtual worlds and economies, told CNET News.com in December. 'So it is incumbent on us to set the terms and the debate so we have a shaped tax policy toward virtual worlds and virtual economies in a favorable way.'"
Source: http://shorl.com/gevugrabebofro (GameDaily); http://news.com.com/8301-10784_3-9733848-7.html
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interesting post. omar and i were talking about this during break last week, and we were throwing out interesting scenarios of jurisdictional contact and execution.
what could happen if one refuses to pay the virtual tax from an online world and the tax man cometh? can they attach our virtual property? surely this wouldn't be problematic in second life - but what about the militant hordes and armies of war worlds?
yes, it would probably be as boring as just sending a notice to a hosting company. but i expect people to fight back, on and offline. :)
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