US to tax virtual worlds?

Written by Joe Martin

June 26, 2007 // 11:02 a.m.

Tags: #america #congress #law #legal #lortro #mmo #online #second-life #sl #tax #us #usa #warcraft #wow

It may be one of the richest nations in the world, but the US government still has plenty of greed to go around and has apparently set its sights on the virtual communities of the world as the next possible source of revenue.

Every day, millions of dollars are exchanged for virtual goods. Character swapping in World of Warcraft, Linden dollar purchases in Second Life; each transaction adds up whether approved by moderators or in frowned upon or illicit circles and the American government is considering just how they might get a slice of that big ol' money pie.

Dan Miller, a senior economist for Congress' Joint Economic Committee, has stated that the congressional report on the move to tax virtual goods will be released by August this year. He's not giving any hints as to what exactly the report will decide is the best route to follow, but when was the last time you saw a government of a country as big as the United States' miss out on a chance to make some sweet moolah?

It'll be a controversial move for the US of A if it does decide to tax the sale and traffic of virtual goods and general opinion suggests that that is exactly what is going to happen and a lot of people are wondering just how the sales would be monitored by the government.

It will also be interesting to note what effect the move may have on the popularity of virtual communities such as Entropia and Second Life and who exactly the US government will tax in the process - after all, one slip in the application process and you may find yourself marked as a US citizen.

If approved and successful, it may not be long before other countries make similar moves to tax virtual sales.

Ever tried Second Life? Do national governments have the right to tax non-physical, virtual identities and communities? Let us know what you think in our community.

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