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Congress to Revisit Virtual Goods Taxation
News.com has the word that congress is set to re-visit taxing virtual goods, a concept they shelved a while back in order to consider the matter more fully. That's given the Congress' Joint Economic Committee time to come to a decision about what exactly the value of virtual goods means for players and game-makers. An economist with the group told CNet to expect their report sometime next month. "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.'"
Even in the virtual world, you have death and taxes.
If you're going to tax virtual items, why not just use the approach used to eBay, in which you are responsible for tracking and calculating your taxable burden, and reporting it on your tax return? Of course, almost no one will do this, but people have a habit of not paying taxes for what they don't want or need, or view as illegitimate. Which is something the government should have to deal with in a more civilized fashion.
Slashdot: Playing Favorites Since 1997
Luckily, FairTax would abolish the idea of taxing virtual economies altogether, at least from what I've read and understand. Only services and first-hand goods are taxed, used items are not. Since you never purchased the virtual items to begin with, there is nothing to tax.
One small question arises from companies like Sony and SecondLife that sell virtual goods. Obviousy your monthly access fee would be taxed (recall that under FairTax, income is not taxed, only spending, so it's simply moving your tax due to your spending instead of income).
fairtax.org
I can't wait to do tax write offs for giving gold out to newbies.
God spoke to me.
I'll just remit my copper to the IRS via in-game mail. They can use the gold they collect to buy more Fel Iron shells my engineer makes for shipment to the troops in Iraq. That will drive the cost sky high. I'll be rich and can get that elite flying mount soon!
But it would be interesting to see some players form a non-profit company whose only assets were in-game.
Does the government REALLY understand what it's getting into? I don't think so.
What about theft? Or ganking? If it is taxable, does the loss of it reduce your taxes?
How does virtual goods and gold from wow translate into real money for the IRS?
Seems silly and a waste of time. People do not use virtual gold on wow for real currencies though the spammers and pharmers seem to make money off it.
Until virtual currencies become worth accepting on the financial market then its a waste of time.
http://saveie6.com/
So, would this include digital music/movies, or are those already taxed?
....pay the taxes in virtual money/value and let the government trade it in for something they can use, like virtual weapons of mass destruction or virtual anti-terrorist defence, or for the more domestic spending, virtual road repair, virtual food stamps, virtual housing for the poor, etc...
come from this as a big pro. As people will not want to pay tax for in game gold and other things that eula says is = to $0 usd if not. People who just play the game with out trading in game stuff for cash will quit the game.
Second Life eula says that in game things do have cash value so they may be in for some big time IRS work load also they may also have to crack down in game Casinos and other things that may not be lawful in some states / areas.
I'll bet next they'll want to have a breathing tax, so they can tax people's AIR. Oh, wait... they're already trying to do that with the global carbon tax.
On the bright side, at least there's no doubt as to the state of cynicism.
... if we start getting tax revenue from intellectual property too. Mickey Mouse is probably worth $1 billion, let's charge Disney 2.5% a year until it's in the public domain.
... I mean, what else is there to do anyway?
------ The best brain training is now totally free : )
So, not only is the IRS adamant about taxing "all income"
Basically, what is happening here is that someone is saying "I have 1,000,000 hippo bucks" and the IRS is trying to establish some metric of determining how much a "hippo buck" is worth in US dollars so they can tax it. OK, Slashdot: I'm offering those 1,000,000 hippo bucks for sale...who's going to buy them from me and establish the official conversion rate?
Oh wait, nobody because even a billion "hippo bucks" aren't worth anything. So then if I give someone 10,000 of my hippo bucks, has a transaction occured? Choose your own adventure:
Answer YES: Then guess f'ing what...every game of Monopoly is income and so, in aggregate, the population of the US probably owes trillions in unreported income to the IRS for all the games of Monopoly that have been played since its creation.
Answer NO: Then you're instantly smarter than our entire Congress and IRS because you realize that ITS A FREAKIN GAME. As soon as the game is dissolve, said "income" evaporates into thin air. That's the point. Sure, MMORPGs may run a lot longer than your typical game of Monopoly but guess what...if Sony went out of business and Everquest turned off its servers, then what would be left? Nothing but memories and bragging rights...which is all that's really left after a game of Monopoly.
Virtual taxes should be paid in virtual dollars. All the servers and the space the occupy, you know...reality, are already taxed at every possible level. Otherwise, what's to stop the IRS from taxing your score in Pac-Man? Couldn't that spot on the Hi-Score list have value and be auctioned on eBay? (L@@K YOUR INITIALS ON TOP!!! NO RESERVE!) Or how about those packets currently flowing into my computer...don't those have value? If someone idiot buys a single packet from me for $1000, then we are all screwed.
As a closing note, I'm uncomfortable with how easily my analogy about fictional money and invented wealth matches a description of the current US currency system. Hrm. Maybe the entire US banking system is already an MMORPG.
-JoeShmoe
.
-- I wonder which will go down in history as the bigger failure: the War on Drugs or the War on Filesharing
Apparently stupidity and greed among politicians are growing at the same rate. The only fair (as in "screw everybody the same") tax is on real income earned with virtual goods. Everything else is just dollar signs in politicians eyes.
Seriously, it real life - the taxes go for things that effect us physically or that the entities we pay provide a service we use even if indirectly.
In real life taxes pay for...
1) roads
2) traffic control (stop signs, lights, etc...)
3) financial assistance (welfare, medicare, etc..)
4) law enforcement
5) military (protection of way of life)
6) etc...
I used to play WoW, so I'll use that as my example...
1) environment - developed and controlled by game maker
2) traffic control - disigned/mantained by your ISP
3) law enforcement - in game police, gamers paid by developer to help keep things under control - GM's
4) military protection - the particular guild your in, you pay them taxes via items found, helping noobs, etc...
Everything is covered and we pay either the ISP or the game maker (Blizzard in this case) and the government does not provide anything as far as I can tell. If they were to start collecting taxes what could they possibly offer that's not already covered?
Taxes: Funds provided by taxation have been used by states and their functional equivalents throughout history to carry out many functions. Some of these include expenditures on war, the enforcement of law and public order, protection of property, economic infrastructure (roads, legal tender, enforcement of contracts, etc.), public works, social engineering, and the operation of government itself. Most modern governments also use taxes to fund welfare and public services. These services can include education systems, health care systems, pensions for the elderly, unemployment benefits, and public transportation. Energy, water and waste management systems are also common public utilities. Colonial and moderning states have also used cash taxes to draw or force reluctant subsistence producers into cash economies.
The above is all covered by the developer, if it even exists - again what could they possibly offer? It's not like they can re-write the game engine to add an educational system if doesn't already exist...
With Illegal Immigration on the table, and a war in Iraq, along with their ratings being the lowest ever, how do they have time to even consider messing in our lives otherwise? Or do they plan to ship all the illegals to Second Life as a solution that both sides will buy?
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Let's translate this damned thing into reality:
congress is set to re-visit taxing virtual goods, a concept they shelved a while back in order to consider the matter more fully.
Congress, as a whole, doesn't fucking care.
'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,'
I extrapolate exponential trends, showing my poor grasp of statistics. I also make baseless speculations sound important by name-dropping governmental agencies.
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.'"
Somebody with way too much time on his hands takes this shit way too seriously.
If I were an American, and a fictional story about me winning a hundred million dollars got published in a magazine, the IRS would expect to be able to actually tax me on those fictional winnings?
What goes on in these games is not real... it is fiction. And somehow the IRS figures its not only entitled to a portion of what you actually make, but also a portion of what you might have _imagined_ yourself making?
Uhmm... wow. Just wow.
File under 'M' for 'Manic ranting'
Also, are these earnings "overseas" earnings that might avoid taxation. After all, show me just where in the USA my SL property is located.
Most of all, will Linden Research turn over records to the IRS that they would need in order to track users down. And can you hide yourself through foreign proxies? After all, try as they might, they've not shutdown Internet gambling yet.
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
in Monopoly money?
Or are they going to tax me for my hotel on Park Place too?
This is the kind of shit that Tories were shot for in 1776. Seems ripe enough time again.
"Flyin' in just a sweet place,
Never been known to fail..."
this makes no sense.
if i sell a virtual item for USD, that is income and it is already taxed.
stocks in a company are 'virtual' and existing in a 'computer simulation'.
non-physical items are nothing new.
the other interpretation is impossibly ludicrous which is to tax items created
and sold in-game with no real-world value. if thats the case then they must
collect the taxes in the form of in-world items.
As many of you know, many of the games, for which these virtual traders trade their goods, have an explicit no Real World trading rule imposed on the economy. My question is: Will congress take into consideration this very important fact? Imposing a tax on illicit trading ingame is like taxing the drug trade. It shouldn't be happening in the first place!
"And in other news today, a new tax levy of 10% has left table-top gamers hoping to 'roll 18s' instead."
. . . it'll have all sorts of unintended consequences too.
What virtual property is the government going to tax exactly? The few MMO's that offer legitimate currency exchange, such as Second LIfe and Entropia, convert your virtual goods and income into real world income. This real, legal currency is then taxed as miscellaneous income. If you make more than X dollars a year this way (or through eBay, etc.) then you pay taxes. So, the government already taxes income from virtual sources.
Then there's the vast illegitimate virtual currency exchange market that Congress and the media gets its "billion-dollar-a-year business" numbers from. Sure, WoW gold may sell for 500/$25 but it does so in violation of Blizzard's EULA which is a binding legal agreement. So, if the feds start taxing the illegitimate purchase of virtual currency, either a) Sale of virtual goods and currency becomes legal and Blizzard, Sony, etc. can't place restrictions or b) All forms of piracy or "black market" business become taxable since there's no difference between selling gold that Blizzard has the legal rights to and selling copies of movies or music that Sony, etc. have the legal rights to.
Taxation of virtual goods will have all sorts of interesting legitimizing consequences. Virtual worlds may end up declaring themselves states or countries for tax purposes. But, then, that wouldn't be unprecedented. The US started out as an investment venture and revenue source which later became a country in order to avoid taxes.
Will they tax Monopoly money too?
Tax anytime real world money is exchanged for virtual goods.
If I sell you an item in a game for $50, I would be required to declare that $50 as income for tax purposes.
If I give Linden Labs 100 L$ and get $50 back, I would be required to declare that $50 as income for tax purposes.
"Mr Jones? Max Smith, Internal Revenue Service calling. Seems to us here at the IRS that there is a problem with your 2007 Form 1040. You failed to report the income from the sales of 12 residential dwellings, and the profits from the subsequent erection of three hotels in their places, located, according to our records, on Illinois, Indiana, and Kentucky Avenues. Additionally, you collected $1,600 in fees from a person named Gorge Ricardo for a hotel you owned on Boardwalk Ave., on four separate occasions, which he claimed as a business expense. Taxes and penalties assessed will total approximately $18,274.89. You may round this down to the next lower dollar if you compute these figures in whole dollars only.
We expect to receive a check in payment by August 15th, or you may expect to be levied additional fees, or possibly having a warrant issued for your arrest. Nobody wants that to happen, so... would you like to copy down the address you can send your check in to?"
~hal
As long as I can pay with virtual money.
Welcome the new Democratically Controlled Congress
If anyone was looking for a way to show these morons for the fools they are this is it!!!
I want to hear them explain how this is any diferent than taxing monopoly money!!! I mean really, how is this justified. They are not talking about taxing the REAL money you made from selling a character or what ever on ebay- they are talking about virtual money!!!
So what is the exchaneg rate, becuase I dont know if I can pay the tax on 1,000,000,000 virtual dollars. Oh, they must have way to take that 1,000,000,000 dollars and convert it to US Dollars right, then I can pay the tax no problem.
Sure take 66%- I'm completely ok with that- I think 333,000,000 income is ok
So lets every one be clear on this, we need to pay real taxes for virtual money.
These people need to go. They need to all go in 2008- they need to understand that they represent the people and the people DO NOT ACCEPT THIS BULLSHIT
In case you didnt here, the US congress as a whole got a 14% approval rating this week. Do you know why- because they are unqualified to do their job.
Its time to make clear to these people where the power really is.
If this goes through, we all need to go on strike Atlas Shrugged style. People that think these laws are jsutified are the enemy and they should be treated as such.
GIVE THEM NOTHING TO TAX -- RON PAUL WE NEED YOU TAKE THIS ISSUE -- SHOW THE PEOPLE WHATS WRONG WITH THE SYSTEM -- THIS IS YOUR GOLDEN SOUND BITE MOMENT!!! YOU WERE AWESOME ON DAILY SHOW -- DO THE SHOW AGAIN WITH THIS TOPIC!!! PLEASE
I'll start paying taxes for virtual goods when my character can vote.
- RG>
Hey pal, this isn't a pleasantforest, so don't waste my time with pleasantries!
Ron Paul we need you take this issue -- show the people whats wrong with the system
this is your golden sound bite moment!!!
you were awesome on daily show -- do the show again with this topic!!! please
This is going to be a slippery slope. Players don't own the virtual property. The game companies do. Even if you pay someone real cash for in-game currency or items, it still belongs to the game company. How can you be taxed for something that you do not own?
If you replace "hippo bucks" with "hippo shares" then you have a similar, completely abstract currency. If they went bankrupt, there'd be nothing but sweet memory left of those stocks either. Yet somehow, we manage to set a market value to that. Deltas in that value are considered profits or losses. For 99% of us the value would go in zero anyway once you cancel your WoW account. Taxing people that make a real-world profit this way is hardly unreasonable, at least not anymore than any other income tax.
Live today, because you never know what tomorrow brings
Just to put a point on that, the IRS is not autonomous; the IRS works at the bequest and guidance of Congress. Congress sets the policy, the IRS executes it. So the Democrats, through the appropriate committee, have asked the IRS to re-examine the taxation of virtual goods, and the IRS is doing so... don't blame the messenger.
Regardless, what's with all the complaining about taxation? I thought all the libe... uh, I mean "progressives", here on
Just when you thought that Big Brother had put a tax on everything, they do one better:
Now they want to tax things that don't exist.
Knowing Google's lust for data collection, the Soviet Union is still alive and well inside the psyche of Sergey Brin....
As long as taxes for virtual goods and services are virtual in themselves. In which case, I might end up voting for some of my virtual representatives some day.
Ok so 1 Million gil in FFXI on server X = $30, but on server Y = $25. So how do they even begin to figure out the value to tax at? Multiply this out by every online game and every server and you end up with a logistical nightmare of trying to figure out how to tax it. So, not that it would stop them, but it kinda puts them in a situation of spending $1000 to tax you $10.
The other side to this, is that unless you deal with non IT managers and such you will probably never understand. It isn't that they are that greedy trying to come up with inventive ways of taxing you. Its that this kind of shit honestly makes sense to them. I spent 45 minutes the other day trying to explain why we couldn't make something happen, and I wasn't using technical stuff. I was drawing big multicolored circles to show that the two networks in question are not connected and the traffic cannot just go between them just because each network happened to have a computer in the same room as the other. They assume that all the computers are magically connected because they are networked. On top of this they frequently believe they are being lied to by IT because IT just doesn't want to do it, and not that IT is actually telling them it just can't work that way. There is absolutely no concept, nor any desire to learn even the fundamental workings of IT. Look at Sen "internet tubes" he wasn't being intentionally stupid...he really believes that insanity..and because anyone correcting him would be opposing his ideology on the subject he would just assume they are lying to him.
The only change I can believe in is what I find in my couch cushions.
This just in, Baseball fans...
You will now be charged for each run your hometown team scores. Cities with two teams may select which team they prefer the next time they file their 1040.
(Exception: Residents of Chicago choosing the White Sox will be arrested for tax evasion.)
If they start taxing virtual transactions, then my dwarf gets a seat in congress.
They can't tax virtual goods. Congress is being retarded by wasting tax money even looking into it.
. . . asteroid made out of gold lands gently in the middle of the game and causes gold futures to collapse. And (as others have pointed out), what if a big giant gold asteroid hits the game servers?
Their they're doing there hair.
"You loot the goblin corpse and find 3000 gold coins. Minus tax you now have collected 2950 gold coins."
Really, these are real people selling a good/service that people are willing to pay real money for, so I have no problem with that being taxed.
I don't think taxing anything else would really work out. (Tax Blizzard because they have a server up that happens to have virtual goods? Wouldn't that basically be a server tax?)
Think of what would happen if the government instituted a pithy 5% consumption tax on Azeroth. Across all US servers. And then opened an office to sell the resulting gold for US dollars. That would be an entirely real headache for an entirely real several-hundred-million-dollars.
(If this strikes you as unlikely, replace it with them taxing gold-for-dollars transactions, as they already theoretically do. All they need is a way to actually discover that the transactions are taking place, in the same way that your bank is required to report to the government any year they pay you more than $10 in dividends.)
Help poke pirates in the eyepatch, arr.
"You know, we already tax most of the things we do for pleasure... drinking, smoking. What if we taxed... you know, thingy?" "Thingy?" "Yes, you know, thingy." "I'm afraid I don't. Could you please be more explicit?" " You know - thingy!"
They can suck my virtual cock.
Swaps of real world goods should also be classified as income.
If I sell you an item in a game for Starbucks coupons, or for $50 of instant noodles that should also be declared as income.
Just because it's not progressive, which means that higher income levels are progressively taxed higher rates, does not mean that it's regressive which in this context means that higher income levels are progressively taxed lower rates.
Fairtax doesn't do that. It is, at its heart, a VAT. If that was all it was, all spending would be taxed at the same rate. Those with more wealth would be taxed higher amounts than those with less. But all the money gets taxed because it all eventually gets spent.
But fairtax doesn't stop there. It also provides for an allowance on the first so-many dollars spent. Since this tax-rebate is held to a constant ceiling, it is a lower percentage of a higher-income than lower-income. It is an inelegant solution, but it puts Fairtax weakly in the progressive column.
A 30% tax (and, IIRC, ~17% was the proposed level) would cause no such thing if, as per the fairtax plan, it was enacted while eliminating the other taxes (income, etc) that amount to the same percentage. It is a truism that a revenue neutral tax-code change removes exactly the same amount of money from the economy.
It should also be noted that a progressive income tax doesn't, as you'd think, tax the rich more. It taxes the becoming rich more. It is an obstacle to separate the already-wealthy from the becoming-wealthy, and since it was implemented by the already-wealthy, you should consider the possibility that it may even have been one of their goals.
Can you be Even More Awesome?!
I don't hold any valuable intellectual property, or work for a company that does, so I don't know the answer to this one. Is intellectual property taxable in the same way as physical property? Not just virtual property in an MMO, but does Sony have to have somebody periodically come up with a value for and pay ongoing property taxes on its library of songs? If they're going to take the position that virtual property is real enough to tax, why not far more tangible intellectual property? (I know, not the IRS' jurisdiction, but municipalities can fight over who gets the money later.)
I wonder if that 100M isk in Liquor I bought in Amarr space, only to find out its contraband there is tax deductable?
Lets see, I think I can sell Senator Hillary some shares in my corp for 1M isk each, pump it up and buy it back for 300M isk each, Give all my Dancing girls to Senator Kennedy and Senator Dodd, Representative Barney Frank can have the Science graduates, and I should probably stop scuttling my old Iteron 1's full of homeless people.
That will probably buy me some political clout for a few years.
Seriously. What is a virtual good? A poem? A news article from Reuters? A short fiction story? Some 3d models of a car? Some 3d models of a car produced by a stock 3d image firm and then sold to a movie producer? Do we define a virtual good simply as bits and bytes that can only exist within a certain software program (i.e. a sword in Warcraft) and cannot easily "leave" that environment? Does this cover CAD files? It seems like the government simply wants to tax money transfers, which is historically what they do. In Canada it's really simple, we have a federal Goods and Services Tax (GST, 6%) which is applied to.. well.. all goods and services except basic needs (most foods, etc.). If money changes hands, we're supposed to report it and the GST. Doesn't matter if it's random scribbles on a paper or a happy thought.
Genius! This will/would be the death of MMOs.
We've discovered that 100% of people use air. This is a massive untapped area with extreme potential to increase revenue via taxation. We believe it to be in the best interests of everyone that the taxation of air is done in a fair and reasonable manner.
The real question is, why is this any different from a very long game of Monopoly. Why shouldn't they tax the money in Monopoly then? And WHICH Monopoly? The original with 1s,5s...50s,100s, and 500s? Or the modern with 5 millions, 1 millions, 500,000s, 200,000s, 100,000s, 50,000s, 10,000s. Talk about a difference in taxes for the same game.
Why not just default everything in the game? So something that cost $1 yesterday would be 1 millionth of a cent tomorrow?
The whole idea is insane, but that is what one should expect from government.
1. Booming server business outside the US(the Cayman Islands or countries that have free trade agreements with the US). 2. Mandatory use of non-US banking for transactions. 3. Diversity code to prevent people from the same state/country from interacting with each other (no more gaming with people you know IRL). 4. Increased demand for off the net LAN games and single player games. 5. Further exodus of IT jobs/companies/infrastructure from the US.
The government has not been terribly swift in taking constructive action on aspects of internet life of concern to the citizens - eg, privacy protection and exploitation of personal information - but rapidly comes to grips as soon as it comes to taxes.
I think you explained why your idea wouldn't work. What if everything I buy over $20k I resell to my cousin and he lets me use it?
For any tax system to work it should be flat, no exceptions. Let's say my church buys an SUV to bring the children to sunday school. Tax exempt of course, could you imagine any more noble use for an SUV? OK, but who will be responsible for checking if the reverend isn't using the SUV himself the other six days of the week?
As soon as you put *any* exception or break in a tax system someone will invent a way to abuse it.
Play a game where you give a friend $100. He pays the IRS a tax on his "windfall" income. Then he gives the rest back to you. You then pay the IRS a tax on your "windfall" income. Keep playing until the IRS has taken it all.
If you read the terms of service of most of these online games, you don't actually own anything in them, neither can you claim to in a court of law.
Any tax on, say, World of Warcraft net worth, given that it exists purely at the fiat of Blizzard and can be flicked in and out of existance at the whim of any fickle GM, would have to be paid by Blizzard, not the players.
I can't imagine any of the big companies in this realm either: (A) conceding that players have rights to own anything, or (B) paying taxes on virtual items.
Which isn't to suggest that congress won't pass some retarded law on the subject, as congress doesn't do anything that doesn't involve passing retarded laws. But I find it hard to imagine that such a tax could withstand either industry pressure (remember, this industry has a net worth rivaling or exceeding the film industry and backed by most of the same players) or judicial review.
This is insane, they are already illegal taxing American citizen wages, now they want to illegaly tax virtually money, insane. If the Americans put up with this much longer we deserve what we get and have already for the most part. And Authoritarian government, and a police state. If you want to stop this kind of corruption Vote Ron Paul in 2008. http://www.ronpaul2008.com/
If someone writes a bot that makes its own decisions and pays for its own account with its in-game winnings, does it--because it is connected to tax laws--take on the legal protections of a "person?" A corporation has such legal protections. Is it then connected to all the laws? Can it sue? Can it vote? If they tax it, it certainly would have the right to pursue a case in tax court. Must it be assigned some kind of representative of the law in a court case like a child? What a mess that would become. They better be very very careful what they do in the virtual world or they will come to regret it severely. We have already seen talk of rape cases in the virtual world. The greed of the Government may end up costing much more than it gets in tax revenue. I think that the Government should stay out of the virtual world for a long long time to come--at least until it is thoroughly thrashed out how, or even if it should be connected to the real world. I'm for a solid wall separating real from virtual. If it means not getting the last tax dollar, so be it.
E Proelio Veritas.
The problem is not taxing someone's income, it's trying to tax it before it becomes income.
You mean 'the trick', not 'the problem'. Because you have to tax money when someone buys something, then tax them if they sell it. Plus tax the person who sold it for the money they got on the taxed good, and then tax them for whatever they do with the money. Tax any transaction. That must be some kind of trick for it to make sense to anyone.
Let's also tax peoples softball league scores, their bowling league scores, their dartboard league scores. Let's tax people for playing Jeopardy at home with their friends. Let's tax children's games of "go fish."
OH let's tax the people who are in the Olympics! "Oh, she got a 9.9, that's so sad, she's going to be in debt for YEARS paying for that!"
The only part of virtual property they should be taxing is when it is changed into money.
I guess, at least, when they start taxing the VALUE of our virtual property, more game companies will be forced to give their players a method of translating that property into money. Or the government will be forced to.
(Personally, I'm for *EVERY* mmorpg allowing a small amount of servers to allow legal buying and selling. Look up Sony's station exchange for an example.)
Anon,
I did a little asking around, turns out the exchange rate is unspecified, or more to the point, if you earn 5000 Buckazoids, or Zorkmids (TM) or Triganic Ningies, or Gold Pieces, etc., they aren't looking for dollars as a percentage of your gross.
They're looking for Buckazoids, or Zorkmids (TM) or Triganic Ningies, or Gold Pieces, etc.
They want you to travel the virtual galaxy, fight virtual monsters, or dust virtual miniblinds, sell virtual illicit drugs, etc., and then give them the virtual cash...
THEY WANT TO BE ABLE TO PLAY TOO!
And they don't want to have to do the grunt work of virtually EARNING the virtual cheese. The way they figure it, when you find out they don't want actual money, that people will be so relieved that they'll fork over the virtual stuff happily!
No, actually, I was just kidding. They want your dollars.
~Hal
can you say, "gift tax"? iirc, one person may give $11k before the taxing starts
It's Apr 15, 1837
You have 14 oxen
Your water barrels are 12% full
You have 2.3 days of rations
You have $43
You have traveled 1349 miles
(H)unt (T)rade (G)o (P)ay Taxes
>G
It's Apr 16, 1837
You have 15 oxen
Your water barrels are 8% full
You have 1.3 days of rations
You have $43
You have traveled 1378 miles
There is a warrant out for your arrest for tax evasion.
(H)unt (T)rade (G)o (P)ay Taxes
>
I used to be in tax accounting before I moved to the games industry. You don't tax poker chips until you convert them into cash, you shouldn't tax magical swords until you sell them on eBay. Here's the argument fleshed out on my blog.
AFAIK, Second Life EULA states that in-game property is truely owned by the player, it also states that they don't guarentee any real-life value for in-game property. The in-game cash (L$) you bought for US$ 10,000.- today may become worthless tomorrow.
Slashdot social media options: AIM, ICQ, Yahoo, Jabber and Mobile Text. Why no MySpace?
Taxing virtual goods. What's next, Homeland Security sending your imaginary friends to Gitmo for interregation ?
What's wrong with just taxing things at the point of sale, just like any other industry?
It's like two kids trading Pokemon cards, then someone wants to tax that because some 34 year old wants to sell the ultra-rare Ripuoff-chu card for $30.
I suggest we pay attention to who, in Congress, is leading this charge, then have a chat with them at the next election.
(-1: Post disagrees with my already-settled worldview) is not a valid mod option.
The thieving fiends who (US) take 60% minimum of everything and still put us $9 trillion (minimum) in debt now want to slap a tax on any old useful arrangement of bits in virtual worlds? These goons have no shame. Nail them to the wall.