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"Sweden is taking aim at online tax evasion and the estimated five billion Swedish krona (SEK) in annual undeclared income by the country's citizens. (This equates to roughly USD 645 million.) While much of this is revenue from \"online marketplaces, porn, and astrology sites\", undeclared income from games and virtual worlds are included in that figure. In fact, the Swedish Tax Agency (Skatteverket) looked at the sales of avatars and characters in 'computer games' over a 14 month period, with a collective advertised sum of 662 million SEK (USD 85 million). No income was declared on any of these transactions so it's a safe bet they'll be scrutinizing these sales moving forward. Although the specific virtual worlds and games aren't named, GameCulture adds that the virtual property Skatteverket is looking at exchanged hands between 7000 gamers and residents. Also interesting is what GamePolitics turned up on the situation -- \"even U.S. citizens could be subject to Swedish taxation on such virtual transactions, according to the Economics of Virtual Worlds blog.\""^^<http://www.w3.org/2001/XMLSchema#string>
<http://www.engadget.com/2009/07/21/sweden-extending-taxation-into-the-virtual/>