We will go ahead and remove the L$-1000 cap on tax impact on Thursday, August 7th. Here is some background:
This change to the tax code affects only a small number of Residents. A quick look at the numbers shows that just 3 percent of Second Life Residents (excluding trial users) have hit the L$-1000 limit in the last month -- and at least half of that group appear to have hit it accidentally-- with individual amount of tax savings ranging anywhere from L$40 to L$70,000. Over that past 30 days, this has left better than 11 percent of Second Life's total assessed taxes unpaid.
Collected taxes do not affect the level of stipend distributed in Second Life (an early attempt to tie the two was notably unsuccessful), but allowing this volume of money to enter the economy unrestricted could create conditions leading to land shortages, maximum primitive usage, and eventual inflation.
The L$-1,000 tax limit was never meant to be a tool for accumulating wealth. We're confident that this adjustment will lead to a more fair and efficient tax system, and hope that the time between the announcement of removal of the limit and its implementation has allowed the affected resident to put their affairs in order.