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China Reversed Ban, Imposes 20% Tax on Gold Farmers
If you can't beat 'em, tax 'em.
Only two years ago China "strictly forbid" players from making money trading virtual currencies. The statement wasn't enforced and gold farming continued to rise in the country.
Now the Financial Times has announced that China has announced a 20% tax on money made from trading virtual currencies.
Some interesting lines from the article:
* "Trade in virtual items – ranging from “gold†coins to magic swords and in-game property rights – is estimated to be worth more than Rmb10bn ($1.45bn, €1.15bn, £900m) a year in China alone, according to consultancy iResearch."
* "Beijing tax officials declined to explain how they would implement the vaguely worded ruling, with local media saying detailed regulations could be announced in the coming days. However, Chinese analysts and games players suggested that the authorities’ attempt to tax the virtual currency trade would fare no better than the previous effort to ban it."
As we have said in the past, prohibition rarely works and gaming companies and governments would be much better suited to enforce regulation and taxation than prohibition of this emerging market.
What do you think the future of virtual game markets will be? Prohibition? Free Markets/Trade? Regulation? Let us know.
Now the Financial Times has announced that China has announced a 20% tax on money made from trading virtual currencies.
Some interesting lines from the article:
* "Trade in virtual items – ranging from “gold†coins to magic swords and in-game property rights – is estimated to be worth more than Rmb10bn ($1.45bn, €1.15bn, £900m) a year in China alone, according to consultancy iResearch."
* "Beijing tax officials declined to explain how they would implement the vaguely worded ruling, with local media saying detailed regulations could be announced in the coming days. However, Chinese analysts and games players suggested that the authorities’ attempt to tax the virtual currency trade would fare no better than the previous effort to ban it."
As we have said in the past, prohibition rarely works and gaming companies and governments would be much better suited to enforce regulation and taxation than prohibition of this emerging market.
What do you think the future of virtual game markets will be? Prohibition? Free Markets/Trade? Regulation? Let us know.
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