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Australia Introduces Virtual Taxation

by Morphis » Fri Nov 03, 2006 11:50 pm

From: Kotaku | Australia Introduces Virtual Taxation

[lightbox]http://cache.kotaku.com/assets/resources/2006/11/GoldFarm.jpg[/lightbox]

You earn money, you pay taxes: that's the gist of a warning by the ATO (Australian Tax Office) to online profiteers and players of games like Second Life & WoW. An ATO spokeswoman told Aussie newspaper The Age:


"If you are getting a monetary benefit then it's not treated any differently - normal rules apply...your income will not be treated any differently than if you earned it working nine to five in an office."

Not only that, gamers that earn more than AUD$50,000 a year from their exploits must register as a business and pay GST (an additional tax we get slugged with down here).
This was only a matter of time. These games do real business, and people are making real money out of them. If somebody that puts in an honest 9-to-5 has to pay taxes on their income, then there's no way you can justify not doing the same if all you're doing is playing WoW all night.

Bets are now being taken as to which country is next. Luke Plunkett

Virtual world: tax man cometh [The Age]
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by Morphis » Fri Nov 03, 2006 11:52 pm

Watch out the ATO's out to get all of you :o
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by Ryan White » Sat Nov 04, 2006 12:31 am

If I have to pay tax for earning money through the sucky job of stacking shelves, then people getting to play computer games to earn money should pay double.
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by Last Exile » Sat Nov 04, 2006 2:12 am

Ryan White wrote:If I have to pay tax for earning money through the sucky job of stacking shelves, then people getting to play computer games to earn money should pay double.


And in the case of Blizzard, it should be a lot more considering their profits for 2006 and what they'll get in 2007 with the expansion.
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by Morphis » Sat Nov 04, 2006 3:22 am

Last Exile wrote:And in the case of Blizzard, it should be a lot more considering their profits for 2006 and what they'll get in 2007 with the expansion.

It won't cut into any game publishers profit.

YOU(the gamer) will have to declare your earnings and pay income tax on it.
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by Ryan White » Sat Nov 04, 2006 4:20 am

[off topic]Blizzard Entertainment is owned by Vivendi. Vivendi is a company and therefore paid taxes anyway (in this case to the French government) to the value of roughly €1,386,000,000.[/off topic]
It makes sense that the government is deciding to pursue all forms of income for taxation. It'll be interesting to see what effect this will have on Second Life and those people that use RMT to make a living.
What I'd really prefer is for the government to get around to removing income tax. It was only supposed to be introduced on a temporary basis in order to fund WWI.
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by stormy001 » Sat Nov 04, 2006 9:23 am

Many governments around the world are addicted to income tax. Removal of it will be quite revolutionary.
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by Last Exile » Sat Nov 04, 2006 1:41 pm

Indeed, White. Gold farming in MMORPGs has gotten way out of hand. 99% of them are based in China, Hong Kong or Singapore and are set-up sweat shop style to sell gold to anyone in the West who is too lazy to spend an hour or two to get it. So yes, I hope they get hit hard.
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by Mappy » Sat Nov 04, 2006 2:08 pm

Once taxes are introduced, there isn't a governmental sytem in the world that will remove them. It isn't addiction, it's just greed, plain and simple. And it isn't as if they represent anything more than the worst aspects of the rest of us.
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by Ryan White » Sat Nov 04, 2006 9:41 pm

I messed up posting the amount Vivendi payed in tax, fixed now, added the last three zeros.
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by Rasberry » Sun Nov 05, 2006 1:18 am

does the government get income tax on gold received, does my health potion and other weapons contain the 10% G.S.T.
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by Last Exile » Sun Nov 05, 2006 1:29 am

Only if you farm for China, Rasberry. Technically gold farming services aren't legal and such material can be confiscated and end up in accounts being suspended, but Blizzard's position has wavered between nochalant and hostile on this sisue. They used to be lax about it but ever since the major wave of peoples' accoutns being hacked and their items and such sold off for gold, they've gotten substantially tougher on them since it affected a significant amount of the playing population.

As White said to me tonight, did they honestly think they could get away with avoiding tax? It's a business and raking in a lot of money. Of course they should be subjected to the law and tax.It's about time the law caught up with other Internet-related issues as well, it's always so slow with them.
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by Rasberry » Sun Nov 05, 2006 2:16 am

what about sites i.e. e-mail cash?
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by Ryan White » Sun Nov 05, 2006 2:47 am

Rasberry wrote:what about sites i.e. e-mail cash?

You should still be reporting any income from these sites in your tax return, but as I doubt it's possible to make a living off of email cash or even get a sizeable sum in a short amount of time chances are the tax office will hunt larger game.
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by Rasberry » Sun Nov 05, 2006 2:50 am

Ryan White wrote:
Rasberry wrote:what about sites i.e. e-mail cash?

You should still be reporting any income from these sites in your tax return, but as I doubt it's possible to make a living off of email cash or even get a sizeable sum in a short amount of time chances are the tax office will hunt larger game.


email cash claims that it is tax free.....
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by Ryan White » Sun Nov 05, 2006 3:29 am

Rasberry wrote:
email cash claims that it is tax free.....

I'm interested in knowing how email cash can claim this. Just from memory the only thing I can remember being tax free are gifts, email cash rewards don't count as gifts. Email cash probably doesn't want to go to the trouble of taking the tax out of the payment and issuing you with a PAYG statement for your income tax return. The best way to find out would be to get into contact with the ATO and ask them directly.
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by Last Exile » Sun Nov 05, 2006 3:08 pm

I'd like to see how efficiently the ATO monitors this. My mum used to work there yonks ago and she laughed when I mentioned this, simply saying 'I'd like to see how they handle monitoring this.' The amount of time anfd effort they'd have to put in would stack up very quickly.
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by Morphis » Sun Nov 05, 2006 11:24 pm

They won't need to monitor everyone.
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by mbarron » Mon Nov 06, 2006 5:19 pm

100% Authenthic Genuine Tax Advice from BarronCorp Technologies INC.

Step 1:
Remember its not taxable income if you keep it in an overseas paypal account, then use it to buy goods that you then sell in australia to earn money that you place in your business which then reports a a loss on the books that is used as negative gains to reduce tax to near zero while comfortably claiming all other electronic equipment as a business expense to get back GST. Use any cash flowing in to buy luxuries and other non commerical outgoings. The use of advanced wink wink - nudge nudge tactics will help your customers come to terms as to why their invoices come from multiple companies registered in overseas countries. Always carry a knife, not so you can attack ATO field officers but to cut yourself multiple times and pass out while being questioned about holes in your tax documentation large enough to let several armies of lawyers get though, then claim depression & stress and get compo and a disability pension.

Step 2:
???

Step 3:
Live happily ever after!


...
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by stormy001 » Mon Nov 06, 2006 9:22 pm

That's a lot of winks and nudges, Barron :shock:
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by Last Exile » Mon Nov 06, 2006 10:01 pm

I think he's using the underpants scheme from South park somehow.
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by Psike81 » Mon Nov 06, 2006 10:56 pm

Barron ... now that you've published your scheme , legal as it is ASIO has now tracked that message and would probably pass it on to ATO . So , during the process of floating the message ATO is probably trying to be creative about that . :evil:
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