Taxation in Virtual World: Inevitability and Feasibility

This paper first tried to tell you such a fact from the perspectives of tax history and tax law that: with the continuous development and expansion of virtual economy, the taxation in virtual world will be inevitable. Then we distinguished taxable activities from the virtual economic activities based on the Chinese Tax Laws and the legal theory, we proposed that both in-world and inter-world virtual activities are taxable, but not the drops looting. A model analyzing the feasibility of taxing these taxable activities at present stage is established, to show that taxing in-world activities would not be economically efficient, while taxing inter-world would be technically and economically feasible. At last, specific suggestions and implementations are given on how to tax the taxable virtual economic activities at present stage.