Sunday, October 29, 2006

Virtual Worlds: Real Taxes

LONDON (Reuters) - Users of online worlds such as Second Life and World of Warcraft transact millions of dollars worth of virtual goods and services every day, and these virtual economies are beginning to draw the attention of real-world authorities.

"Right now we're 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," said Dan Miller, senior economist for the Joint Economic Committee of the U.S. Congress.

"You could argue that to a certain degree the law has fallen (behind) because you can have a virtual asset and virtual capital gains, but there's no mechanism by which you're taxed on this stuff," he told Reuters in a telephone interview.

My peers and I remain agnostic about Virtual communities like Second Life, but maybe we are swimming against the tide. When the taxman starts dreaming up new ways of fleecing something, you know that it has arrived.

I've got a niggle in the back of my mind though that makes me wonder if Second Life might not be where the real action is.

World of Warcraft is an order of magnitude bigger than Second Life, and I was dumbfounded this week, when my six year old told me that his character was up to level 6 in it. I didn't even know that he was playing, but it turns out that he has been logging with his 16 year old half brother - my erstwhile stepson - when he is at his Mum's.

His brother actually made a point of thanking me for paying his World of Warcraft subscription - something that I've done since he started in happier times - the other day. Something that is so precious to a standard grunting teenage boy that it inspires him to a gracious unprompted gesture, must really have its claws in him.

I should really check it out for research but it is difficult to generate any real enthusiasm - Ben and I are getting Raybs World of Warcraft: The Burning Crusade Expansion Pack for his birthday - here's the pitch:
Several years have passed since the Burning Legion's defeat at Mount Hyjal and the races of Azeroth have continued to rebuild their once shattered lives. With renewed strength, the heroes of the Horde and Alliance have begun to explore new lands and broken through the Dark Portal to investigate the realms beyond the known world. Will these heroes find friends or foes? What dangers and rewards lie in wait beyond the Dark Portal? And what will they do when they discover that the demons they thought vanquished have returned to renew their terrible Burning Crusade?
Don't really float my boat these days I'm afraid, but each to his own. (I'm glad I looked my pre order up on Amazon again this morning because the expansion pack seems to have been put back from next month to 2007, so we are going to have to dream up a different present.)

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