We heard the first stirrings that the United States government wanted to look into taxing virtual assets in games such as World of Warcraft and Second Life earlier this year, but now the idea is becoming a bit more formalized.  The House of Representatives has turned the matter over to... a committee!  And you know what that means.  Surely a bill or two is just a matter of time.  However, there may be a glimmer of sanity in the government after all.  Consider the words of committee chairman Jim Saxon:

"There is a concern that the IRS might step forward with regulations that start taxing transactions that occur within virtual economies. This, I believe, would be a mistake."

Imagine walking into the rustic village of some far off virtual fantasy world.  To your left you see Azkalan's Weapons Tent.  To the right is Kukalaka's Armor Hut.  And straight ahead?  Irving Rosenblatt's Accounting Emporium.  I stand by what I said back in January on this matter: 

Massive amounts of income should be taxed fairly just as the rest of us are taxed on our significant sources of income.  The government shouldn't worry about if I earn $30 selling fake items, but they should if I earn $30,000.  It will be some time before any of this comes to pass, as the government employees behind these policies don't quite understand what it all means.  However, as younger employees familiar with these ideas are promoted and rise to power, that could change.

(via BoingBoing)