Petition LL to pay the VAT themselves and fund costs another way ?

I won't be paying the taxes for someone that are imposed by their government, unless they are going to pay all my taxes, and my health insurance, etc.

People are really looking at the pricing decision the wrong way.

If this were a commodity, like wheat or memory chips, then prices would be driven by costs, and reducing the price to Europeans below cost and making it up by charging US residents a higher price than required by costs would mean that the US residents are subsidizing Europeans.

But this isn't a commodity. Sure, Linden has to charge enough to cover their costs and make a profit acceptable to their investors, but they can charge whatever they want beyond that. They could charge $300/month, $400/month, $500/month, whatever. Of course, they'll lose some customers with higher prices, but they'll make more from the others.

That's when the MBAs step in and build a model that predicts the tradeoffs. There are other factors, but they'll essentially charge what the market will bear, in a way that supports their growth strategy. But the model itself will address different regions differently.

An easy example is software. When Microsoft decides what to charge for an operating system in Europe or Japan, they don't take the US price and the current exchange rate to compute an overseas price. They look at the overseas market and charge what's appropriate to that market. They might lower prices in countries where Linux had a stronger foothold, raise them in areas of high demand. They might lower prices on home products in areas where people have less disposable income.

So don't look at it as though reducing charges on Europeans means US residents are subsidizing it. Look at it as a lower price is needed in Europe to get the same percentage growth in user base, or to get the same profit as in the US.

Nice Kool-Aid. When looking at bottom line profitability, it will be faster to reach it if LL earns the same per player, versus giving a discount to get more players from one particular segment. Anything less is still a subsidy.

Okay, lets assume for sake of argument you are 100% right.

LL did cover the cost for a couple months then made the decision that it needed to pass it along. So evidently their business people decided they should.

Nope Steve. Sorry, ain't gonna happen. Your empathy is commendable but it's not for the rest of the world to compensate for the Europeans.

Personally, I think the tax rate here in the US is ridiculously low but as long as it is I'll take advantage of it. I struggle with health and insurance issues. Most Europeans do not. I'd switch places with them any day.

Paris IS lovely this time of year. *sigh*

So do we therefore subsidise the basic free accounts then?

That's close to an almost maybe sorta Godwin....

We'll Always Have Paris.

We do. Is it right? Not necessarily, but most free accounts don't use the kind of resources I do. And they make the world go 'round. The 10-20% premium accounts do a lot, and make a lot of stuff happen, but those who are free but work/put money into the game are what make the economy flow.

we subsidize the European Free accounts too.

Basics: consume the largest portion of bandwidth and assets yet don't pay

Old premiums: still get their L$400 or L$500 stipend (leaves LL with less L$ to sell directly)

"Odd" accounts: 1024-1536m² in free tier (never did figure out why they have that)

Lifetime accounts: 4096m² in free tier

Educational pricing: 2000+ according to Zee... $8xx sim purchase and $150/month

Old sims: $195/month

It should be clear that there are segments where LL is hemorrhaging money to keep them around (mostly the educational segment) and others where they're making significantly reduced profit (allegedly a $195/month sim is just barely profitable) so other segments pay substantially more to make up for LL's "generosity".

There's plenty of susidy around in SL to make it hypocritical to support one form, but not another, although Zee's statement that the company will eventually collapse financially if they don't pass it on is a bit hard to refute.

Agreed but therefore we don't all pay the same as some have claimed. Sometimes we subsidise for the greater good.

Are EU residents going to chip in to fund American resident's health care and social welfare costs?

No--and it would be silly to ask them to.

Collectively, residents of the EU nations have decided that it's better to have more government services and pay higher taxes. Americans (collectively) have decided they would rather have lower taxes and less government services. Everyone is getting what they pay for. I'm happy with US lower taxes, and I suspect that most EU residents are happy with the level of social services in the EU.

Greater good doesn't equal me paying someone else's taxes.

That remains to be seen but one way or another, non EU residents are going to be at least partially, paying for this.

Other (non EU) people will help pay through higher prices, thats reasonable. Since its optional for them to pay or not.

An across the board price hike for non EU residents by LL to pay for the EU resident's tax is what is not justified.

From an accounting and legal point it would be be impractical and probably illegal but you're getting too caught up in the specifics.

We do subsidise others here and in the majority of cases it's for the benefit of the world as a whole. This "It's not my bill" doesn't stand up to scrutiny, as others have pointed out there are plenty of people hitching a free ride, some hitching a cheap ride. That's the way the world works.

We do not provide free account holders with land, nor do we provide them with Tier, nor do we provide them with Lindens (Anymore) past the sign on amount.

And who provides them with the infrastructure to be here at all?

LOL, Without the Market of the free residents, the wheels fall off the entire thing.

Which was my point about five bloody posts ago when I said it's for the greater good

Now I can go for a cuppa!

Even though I'm politically a bit more Liberal than you probably are, and would gladly pay more US taxes in exchange for universal healthcare....

...Quoted for truth. I think your comments are spot on

I have a question on this question *grins*

EU citizens pay VAT to subsidize their medical benifits (If I understand things correctly...and I may not).

Is the money LL is collecting going to that?

The answer may seem like a no-brainer, but LL is an American based company (even if their bank is in teh UK). Do they need to pay into EU's medical (or wherever the VAT actually gets paid to)?

I ask because I run a plant in RL, and we do sell to EU buisnesses. We do not charge a VAT tax, nor are we incurring any such fees. Those EU buisnesses may be paying import taxes/fees of which my company is not made aware of, but as the selling company, we have nothing at all to do with VAT.

I'm very intrested to know where that money is going. If it's benifiting EU citizens by helping them pay for their medical expenses, then fine. If it's not going toward that, where is it going, and how is it benifiting our EU Residents? (avatars don't get sick after all).

~Jessy

Has anyone posted the percentage of Euro users who are premium and/or island owners?