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

This differs by country -- some countries have different taxes that fund the health systems and then the VAT goes into the general pot.



Right. Normally goods are subject to import duties at the border. Services are trickier across borders, but in 2003 the EU passed a rule stating that internet services provided from outside the EU to people living inside the EU are subject to EU national VAT. That's what LL is dealing with here.



That depends on the country, but in all countries it is going to pay some or other government expense.

You're confusing the issue right here.

LL is collecting the money. But they're not paying anything out of their own pocket to the EU member nations. They're transferring the money they've collected to those nations. The difference is that the money they've collected never belong to LL, they're merely the custodian. It's the end user who is paying it, to the country in which they reside, with LL acting as the tax collector for them. LL doesn't have to pay any EU VAT on their own behalf, except for things they use themselves in their European offices.


It's being turned over to the appropriate government agencies. Whether or not it benefits SL EU residents is a political question for them to decide personally, though I'm sure their governments would say yes.

Ah, kk. As long as the money goes to benifiting the people paying it (by whatever means), I'm satisfied.

Though I think I'll look into reduction of costs to EU customers for my buisness to contend with import taxes. I'm not sure if we ever looked into that aspect before (young company).

Thanks
~Jessy

Nonsense.

You're assuming the number of players stays constant.

Here's an example with arbitrary numbers chosen for simplicity:

Before: There are a 100 customers in the US, 100 in the EU, $100US/each per month, = $20,000 US (and apologies to residesnts of other countries).

After without absorbing the tax: 100 customers in the US, 50 in the EU, $100US/each per month = $15,000 US, and the 50 remaining EU customers who decided to stay are paying an additional $20US each in VAT, which LL collects and turns over to their government, so LL's net income isn't affected. The EU people are now paying $120/month, so there are fewer of them willing to stick around.

After, but absortbing the tax: 100 customers in the US paying $100US/month, 100 in the EU paying $80US/month to LL plus $20US in VAT (Yeah, I'm fudging the percentages for simplicity.) LL's income is now $18,000US, the EU people are still paying the same $100US as the US residents, but some of that money goes to VAT instead of going to LL.

Clearly LL does best without the VAT at all. That's no surprise. But with these numbers - and I admit they're totally arbitrary, but they're not implausible - they have a higher profit by lowering their charges to EU residents.

Could they increase their profit by lowering their fee in the US, making it up with more customers? Maybe, maybe not. The price differences doesn't necessarily change the number of US customers in the same way it changes the number of EU customers. You're not going to see new US residents saying "Gee, I'm going to get into the SL land business because it costs me less than EU residents, and I can undercut their rental charges." But you will see EU residents saying "I'm not going to get into the SL land business because I can't possibly compete against US residents."

It is only higher revenue and higher profit overall, but not per resident, and that is still a subsidy no matter how you slice it.

On that basis, all the retail outlets in the world that "stack 'em high and sell 'em low" are subsidies.


“Thanks for having too much integrity for one single person”

Subsidies are a reality, we just are unaware of them until something like this brings about exposure to the issue. I expect that we will end up subsidizing the EU anyway. And whoever else's government wants to get in on the action will cause us to subsidize them too. It is a matter of time.

It's just too slippery to me. I mean if someone lives in a US state that has a higher income tax than others do, hence less net income, hence less money to spend on SL tier, that person has a higher "cost" of doing business in SL because she has less money to spend on it. Her competitive position is hurt vis-a-vis people in lower tax areas. Shouldn't she also get lower tier fees to balance out her competitive position vis-a-vis those who live in lower tax jurisdictions?

My student loans are such a huge suck. Someone come pay those for me?

No problemo!

ANother thread suggested that non-EU people give 50% of their L$ to EU people.
I told 'em to stuff their 50% and to give me 100%.
When I get it, I;l give you some.
k?




“Thanks for having too much integrity for one single person”

deal!

Yes, but divided by the orbit of the moon.



“Thanks for having too much integrity for one single person”

That's like saying that people who buy SUVs are subsidizing those who buy compacts, or those who buy Lincolns are subsidizing those who buy Fords. Or the average consumer is subsidizing General Motors because we pay more per copy of Windows Vista than GM does.

The numbers may look like that, but that's not how they're derived. It's a corruption of the meaning of the word subsidy.

Actually because of the CAFE regulations and the way the gas guzzler tax works its the exact opposite.

The entry level Ford Ranger is sold for right around cost to maximize profits from the sale of an Expedition ..

People who buy SUVs versus compacts buy a different product. We are all buying the same product, but some will be discriminated against and effectively charged more to account for a cost incurred only by one segment of the populace to cover the bottom line and generate profits. That's a subsidy. This Clintonian view that charging some people less for the same product is not a subsidy is the corruption of the term.

it was a great idea, but Unfortunately will not happen. Too many 'greed is good' types in the US like the poster Xi above, folks brainwashed that good for the community is 'socialism' and their own hard-heared greed and self-centeredness is somehow noble because its 'capitalist'.

You are right, we stand to loose in both business and cultural aspects...shrinking markets and less diversity/more monoculture.

As opposed to those who think that armed robbery is "good for the community", that we are better off punishing those who produce and succeed. Those who don't mind doing good works with someone else's money? The community has no rights to the fruits of my labor. You have no rights to the fruits of my labor. If I choose to share them, which I do, then it is a voluntary act on my part.

If you want to talk about greed and self interest, lets look at charitable giving by nation.

The US gives 1.67% of its GDP to charities.
The UK and Canada are at .73% and .72%
The Netherlands are at .45%
Germany comes in at .22%
Last but not least, France with a whopping .14%

http://www.cafonline.org/pdf/International%20%20Giving%20highlights.pdf

This is true giving, not the armed robbery of taxation.

So lets hear some more crap about how greedy Americans are.

I figure I HAVE to give money to charity, since our government has abandoned all causes here at home to fund the war machine. Plus it makes me feel good...

Sorry Ray, defense is only 17% of the FY2007 budget. Social Security is 21%, Unemployment and welfare payments make up 13%, Medicare and Medicaid combine for 24%.

As for having to, you do it of your own free will, there is a huge difference in that and an IRS agent taking it from you at gun point.

Those are all government imposed programs. I think (merely opinion) that he was referring to the loss of grants and funding for non-profit organizations to make up the difference in defense funding. Some funding was also pulled from educational programs as well, such as D.A.R.E. (I think, it was a juvenile drug program, almost sure it was D.A.R.E.), independent pre-school education (those not part of the school district since most districts don't offer Pre-k anymore). Things like that.

Many of the NPO's lost their grants (or a sizeable portion) in the last year to free up money to move to the war budget. Mostly non-education, but still a loss, none the less. Some money was pulled from animal controls and humane society's, green grass type of NPO's, etc.

(Being military, I have to hear about it a lot, from those in organizations who think we are the evil troll and picket outside US bases, and get that handy dandy wallet card, that tells us not to speak to the media.)

*moves*

The fact that one "can" pay a subsidy does not mean one should or must. The fact that one pays a "subsidy" for reasons a, b, and c does not mean one then has to pay subsidies for reasons x, y, and z.

"Free" accounts can and often do buy L$ and feed money into the SL economy that way. Unverified accounts do not, but can start buying in at any time. That makes it attractive to have them around, though probably not for much longer. Such accounts don't buy land either, whether they are European or not.

Also, since someone asked, the "infrastructure" on which all depend is provided by Linden Lab, which last I heard was still an American company, not a European one, and is entitled to deal with its costs as it chooses. LL chooses to allocate the cost of paying VAT to those who cause the VAT to be incurred. Sounds good to me. Pay your own VAT or get your own government(s) to change your laws and fix the problem your VAT has caused. Don't come around mooching off the rest of the world; it's tacky, dishonorable, and probably won't work very well. To the moocher, people are greedy for refusing to give stuff to the moocher. To the guy whose wallet is getting raided, it's the moocher who is greedy. The world needs a lot fewer moochers, frankly.

LL has evidently decided the VAT-requiring revenues it gets or expects to get from the EU are not worth eating the VAT. Hard to see how it could be. Persuade them differently, with facts and good numbers, and they might listen. Try to lay guilt trips on LL and the rest of the world for not paying your taxes for you, and you are probably just going to continue to be laughed at.

Honestly, all this reminds me of the endless rationalizations and playing around with semantics that filled these forums when gambling was banned. Didn't work then, either.

So "greed" and "self-centeredness" equal "wanting to keep what you have earned" and "unselfishness" means "wanting to take (by threat of force) other people's money to spend on things you want their money spent on"?

Just trying to keep up with the newspeak...

Indeed, I was reading an article not long back regarding philanthropy that pointed out that rich Americans are more generous than rich Brits.

Of course Chris you're going down the lies, damned lies and statistics route. What you see as armed robbery I see as the school I went to between the age of 4-11 being rebuilt with upto date facilities. This wouldn't happen if taxes were lower and it's not in the sort of area where it would happen if parents were charged fees.

No Way am I going to pay extra for the EU players. As consumers they are already getting a good deal due to the weak dollar. When I went to Germany last summer the exchange rate was like paying a 44 percent tax! Everything there was so EXPENSIVE I could not justly the expense. Nobody said oh poor foreigner let me help cover your extra expense.
I do not think it would be legal for SL to collect some of the VAT money from non EU customers. Billing non EU customers more for the same product, I would be most happy to send in a criminal complaint against them. Yes being based in the United States means having the government at your doorstep. A criminal action might mean doing time in jail. Most likely the worse the EU could do is to block access.
I see the VAT money benefiting the EU customer. I did some searching and it seems a record is kept of how much they pay in VAT and there is a way to get some sort of credit for it. In any event it helps pay for their medical, retirement, mass transportation, etc.
No it is very sad they have to pay extra but this is the government they chose and their elected representatives chose to impose the VAT on their Second Life Experience. Linden Labs, Non EU Customers and NON EU governments have nothing to do with the lawful actions of a government within its border. If the VAT bothers you, you need to contact your government representative and complain to them and not people that can do nothing for you!