Updated Tue, Nov 04, 2008 by Medeor
All your gold sales taxes are belong to us.
China's State Administration of Taxation has decided that they too like gold farmers. In a push to regulate the practice, China is taking bold new steps. Some see this as a way for China to help protect virtual assets, but most see it as a way for China to increase their lead as the "world's number one tax bearer." From the Wall Street Journal's interpretation of the Chinese taxation board's website:
China will impose a personal income tax of 20% on profit from virtual money. The announcement, which was distributed to local tax bureaus, specifically takes aim at those who buy virtual currency from gamers and surfers and sell it to others at a mark-up. Taxation officials are granted the right to determine the original price of online virtual currency if the individual fails to provide proof of an original price, it says.
Many things can come from this type of intervention. Yes, gold prices will be going up but more vile is that the bad guys will get even sneakier to get around this law. My guess is that the gold sellers will just take your money and not give you the virtual currency, thus they have no taxable income for exchanging goods. No goods, no taxes. Of course that means that mister gold buyer (yes I'm being sexist because the stereotype fits) is out his money and has no gold. To bad, so sad. Read the rest in the
Wall Street Journal's China Journal,