Trading in Massively Online Game Makes Real Money in Virtual World
Trading in Massively Online Game makes Real Money in Virtual World
Kausar Ahmed
MS Candidate University of South Australia May 22, 2008
Abstract
This paper analyzes the issue of earning real world money from virtual world and the role of taxation on that income. Many virtual worlds have their own internal trade based economy similar to real world economy with its own currency acting as a medium of exchange. A huge virtual money flow in MMOG, so a virtual economic flow can be exist which can effect the real world economy in terms of tax pay. And the gamer integrate real cash into the virtual world through an internal currency exchange system. It illustrate the issues of taxes in virtual games recognizing income could be established by regulators at the point when in-game transaction occurs and at the time of converting game assets into real world money. The tax in MMOG is calculated from gross income of gamers when they receive anything of economic value, whether in the form of cash, property or services. MMOG tax can be collected by voluntary reporting and Internal Revenue Services (IRS) initiative and participating from different nation belongs to their country’s tax rules and regulation.
Keyword: MMOEG, MMORPG, real money trade (RMT), virtual world, multi-user, linden dollar, internal revenue service (IRS), second life, linden lab, virtual economy, taxation, Terms of Service ( TOS )
Introduction
Social network collaborate a group of people to form virtual community which trends to virtual world other than real world where members are sharing resources, skills, profile, contacts, fun and doing business to achieve its mission goal in virtual networks. Online virtual games are one of the most interesting innovations in the area of social network. These games are based on multi-user domains (MUDs) and they have utilized the internet as a new gaming forum that allows people to link up and play together. In Massively Multiplayer Online Economic Game
Kausar Ahmed
MS Candidate University of South Australia May 22, 2008
Abstract
This paper analyzes the issue of earning real world money from virtual world and the role of taxation on that income. Many virtual worlds have their own internal trade based economy similar to real world economy with its own currency acting as a medium of exchange. A huge virtual money flow in MMOG, so a virtual economic flow can be exist which can effect the real world economy in terms of tax pay. And the gamer integrate real cash into the virtual world through an internal currency exchange system. It illustrate the issues of taxes in virtual games recognizing income could be established by regulators at the point when in-game transaction occurs and at the time of converting game assets into real world money. The tax in MMOG is calculated from gross income of gamers when they receive anything of economic value, whether in the form of cash, property or services. MMOG tax can be collected by voluntary reporting and Internal Revenue Services (IRS) initiative and participating from different nation belongs to their country’s tax rules and regulation.
Keyword: MMOEG, MMORPG, real money trade (RMT), virtual world, multi-user, linden dollar, internal revenue service (IRS), second life, linden lab, virtual economy, taxation, Terms of Service ( TOS )
Introduction
Social network collaborate a group of people to form virtual community which trends to virtual world other than real world where members are sharing resources, skills, profile, contacts, fun and doing business to achieve its mission goal in virtual networks. Online virtual games are one of the most interesting innovations in the area of social network. These games are based on multi-user domains (MUDs) and they have utilized the internet as a new gaming forum that allows people to link up and play together. In Massively Multiplayer Online Economic Game