Lawmakers Trying to Head Off Massive Taxation

An anonymous reader writes to mention a Reuters article about a lawmaker's attempt to stop the Government's interest in taxing Massively Multiplayer Game content. R-New Jersey Jim Saxton is cautioning against exploring the taxable status of in-game items. From the article: "'The goal of the forthcoming Joint Economic Committee study is to help lawmakers understand the issues involved and head off any premature attempt to impose a tax on virtual economies,' he said. Under current law, Saxton said if a transaction takes place solely within a virtual world there is no 'taxable event.' Dan Miller, chief economist for the Joint Economic Committee, said earlier this week that the committee's study would start with a blank slate and be completed by the end of the year."

Comments

So does this mean...

[the_skywise]

That if I get a monopoly in Monopoly(r) that my future games have to be government regulated?

That I have to declare income taxes on all cash received while playing PayDay(r)

That I have to declare my tax status to the IRS when I finish the game of Life(r) and retire?

Collateral - perhaps

[davidwr]

Suppose I'm in the business of making MMRPG items and selling them in the real world. I'm a very small business netting $5,000/month for the past year and a half after taxes.

I decide to expand. I could expand slowly, hiring one talented game-player then, when the business grew enough, another.

Or, I could go to a bank or to investors with a business plan to grow the business at the rate of 2 new player every month until I reach 20 players, then re-assess the situation.

Any lender or investor will want to know how much the business is worth. They will want to know all my in-game assets. A bank may loan me money only if I can put these assets up as collateral. In some cases, the company running the game may have to modify their terms of service for me in order to make this happen.

Re:If I have 200 level 60 WoW characters

[WillAffleckUW]

I think the Chinese Gold Farmers would disagree with you there. They make a lot from the equivalent of doing that.

That you choose not to do it for profit doesn't mean it can't be profitable.