Dan Miller, a Senior Economist at the Joint Economic Committee of the U.S. Congress, explained yesterday the virtual world issues that are in his opinion the most important ones to be addressed by the Congress in the near future (the video of the Metanomics session is available on SLCN.tv).

Some days ago, I criticized
a superficial newspaper article I had read about "taxing virtual
worlds": it was simply about paying the VAT on subscription fees, which
is absolutely normal in all degrees of reality from meatspace to
metaverse, as long as the money you pay is, well… money. But taxation
of virtual assets is an important issue, and Miller discussed the way taxation could be introduced by the  Internal Revenue Service (IRS), by means of comparing virtual transactions to barter exchanges.

I always took for granted the definition of virtual money which is found in license agreements. Let’s look at Linden dollars for an example: in the Terms of Service, L$ are defined as "a limited license right to use a feature of the product" – rather vague, but somewhere in the field of Intellectual Property. The barter metaphor is actually more comprehensible, although I am not sure that it would provide a useful context for discussion of legal issues other than taxation.

But, according to Miller, taxation will not be the first thing to come from the Congress. More likely, the Congress will act to address security concerns first, such as money laundering and illegal transfers through convertible virtual money. Or, strictly related to the 3d nature of virtual worlds, the opportunity to use simulations of buildings and cities in order to train criminals and terrorists for their missions. I think that this is really scary, for opposite reasons: that could be true, just imagine the potential for training in an accurate replica of a building which is going to be assaulted. On the other hand, how could you tell criminal training from legitimate role-playing activity carried out by innocent gamers?

Last but not least, an interesting question was raised about promoting standards for interoperability between different virtual worlds. But I suspect that single-sign-on for virtual worlds is not going to happen soon…