Here, let me try and get your attention again: The IRS is looking into ways to tax gains in a video game.
That's right: THE IR-fricken'-S IS STUDYING WAYS TO TAX VIRTUAL GAINS IN A VIRTUAL WORLD.
Do I think they'll come up with a way to implement it? No.
Do I think it's some final threat to the Republic, or a harbinger of some Neal Stephenson-esque societal change? No.
What annoys me is the fact that some idiot thinks it's an idea even worth looking into. What really annoys me is that my very non-virtual tax dollars are being
The thing that really really annoys me is the precedent set for local governments who, if anything, are even less bound by the constraints of the practical than the student-government dweebs who've grown up to infest DC. Can you imagine the dollar signs dancing in the eyes of the Knox County commission when they realize I built a hotel on Boardwalk five years ago? Think of the back property taxes I must owe...
15 comments:
"What annoys me is the fact that some idiot thinks it's an idea even worth looking into."
This is, of course, the real issue. Imagine the personality of the government drone that comes up with the idea of taxing on-line gains. What kind of geek arrives at a point that he even thinks it makes sense to posit this brainstorm for the higher-ups?
Sheesh.
Didn't surprise me a bit. No, I don't think there's anyone sane left (or right, either) on the Beltway. Actually, I question the sanity of anyone who believes the politicians y bureaucrats represent our interests in any way.
Tracy
Many, many, many years ago, when I was in High School (and rocks were soft and dinosaurs walked the land), Dragon magazine featured a cover painting showing two happy adventures ascending from the dungeon, laden with loot, only to encounter a fiendishly grinning IRS agent waiting for them.
And so it goes...
(The study of virtual economies IS a good thing, though, as they tend to show that, beyond doubt, communism doesn't work. (As if anyone still believed it did...) The mere fact people are willing spend hours, or even days, in order to get a frackin' VIRTUAL sword so they can be that much better than their neighbors is hard evidence that human beings will never settle for equality if there is any chance to be superior. Capitalism is the natural economic expression of human liberty, on Earth or Azeroth. Preaching to the choir here, I know...)
I think it makes a kind of sense.
If you support the idea of taxes on capital gains (note: I in no way am leveling that opprobrium at you, Tamara) then an increase in cash value of a virtual investment at the time of its sale has every bit as much of a right to be taxed as any other investment.
Of course, they'd probably have better luck trying to scour EBay for folks who are selling collectables for more than they paid and (horror of horrors) not paying their taxes on it.
Like I said, the whole deal would seem a normal subject if in the Onion. That oughta say something about the Mind of Guvmint.
It brings to mind the 1973 comment of Heinlein, "Government does not exist for the benefit of the governed."
I long ago gave up on the idea of statesmen. I just sorta hoped to find an occasional mature adult. Even that notion seems like a waste of time...
Art
Well, if real/virtual are so easily exchanged, can we swap the real IRS for a virtual version, preferrably one we can uninstall? I'd be all for that.
If you give them the virtual finger, will they send you to a virtual jail ?
But really, it's just a big game isn't it? Taxing a game?
I don't have any problem with people being taxed when they cash out their "virual" money for "real" money, but in the virtual world, I say leave it all alone. The gains/losses/money don't become real unless cashed out.
Two awesome comments from a similar post over at Hit & Run:
If they're going to tax these virtual worlds, I expect they'll have representatives in Congress as well. So we can expect to add Ragnar the Smasher (D - WoW) to the House of Representatives.
Well, if the "cash" on line is real enough to be taxed, then it should be tender legal enough to pay the IRS in. End of story.
Next up, Virtual Gun Control.
That ought to shut down Grand Theft Auto.
They'll be planting flowers in their virtual ghetto gardens.
And all allied players in any of the FPS games will constantly lose their match play.
They have a point, actually.
Since L$ can be converted into US$ in an open currency exchange, it's just like any other currency, from that point of view.
If "virtual" gains are convertible by normal exchange into real US Dollars, I don't see any particular reason they should be immune to tax, given that we have income and capital-gains taxes on non-"virtual" gains.
If you provide a service in Second Life and get paid for it in a currency exchangeable to US dollars, I don't see any reason that's different, tax-wise, from providing a service in "real life" and getting paid in US dollars directly.
(If there is a difference, what is it?
It's "real" currency - in that it's exchangeable for US dollars - and a service provided there is as "real" as, say, phone sex or astrology advice or web publishing, all of which are "real" income, though not physical in-person services.
The idea sounds weird at first glance, but it's utterly consistent and logical. Providing goods in a virtual world in exchangeable currency is legally and practically no different from providing physical goods in any other exchangeable currency.
The interesting part is where the game itself creates value/money... but isn't that just wealth creation the same as manufacturing or making art; by creating something in demand [virtual experience or services], wealth is created where none existed before.
3yellow: I think, come to think of it, that the "personality" of the "drone" that comes up with that is that of the economist who takes "virtual worlds" seriously as they economically deserve to be taken...)
Tape a twenty to a piece of paper and fax it to them.
Should print out a bunch of ones and zeros, cut them up so they're like confetti, then toss them in an envelope, and fire it off with your "virtual" tax return!
Gee, you know, I just can't wrap my mind around the whole idea that since I am being unjustly taxed, it's only fair that "our superiors" should go for someone else's throat using all possible means. I applaud anyone who manages to slip the yoke in any way. After all, "our masters" are only gonna use that money against me and all freemen, and to further an illegal and immoral system; and their greatest allies are those who feel we should all shoulder the yoke according to our ability...
Tracy
I wish I were surprised. It never ceases to amaze me how far some goober-brained plans go when nobody has the brain (or spinal) fortitude to do a reality check.
Then again, *I* work inside the Beltway, so I guess I'm jaded.
-DocF
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