If you think that the U.S.A.'s IRS is the only one planning on imposing taxes on online game loots, think again. Other countries like Sweden are following suit. Swedes who earn tax-free money from playing World of Warcraft and Second Life would have to think twice about their activities as their government said that they were planning a clampdown.

Dag Hardysson, head of the Internet trade division of the Swedish tax authority, said that they "are not interested in ordinary gamers - 99 per cent of them play for the sake of playing...Most people play and keep their money on their game account, but if they move it out of the virtual world into the real world, then we're interested in them."

He cited a couple of examples: a WoW player who advances to a higher level and earned a virtual weapon, which he then sold to another player for real money; and a fashion designer in Second Life who sells clothes in both the real and virtual worlds. But in spite of all the strong words, Hardysson mentioned that he would not expect players to actually have to pay taxes for another two to three years.

Sometime in the next few months, the Joint Economic Committee of Congress will publish the results of an ongoing investigation into the economies of World of Warcraft, Second Life, and other massively multiplayer online games.

What does this have to do with gamers? Well, this report could quite possibly determine whether or not the virtual gold that millions of online gamers earn and spend each day will incur real-world taxes.

A PC World article that we read today pegs the exchange rate for one gold piece in WoW at an unofficial rate of seven to the U.S. dollar. Second Life, on the other hand, actively encourages a real-world type of economy with an official market-driven rate of roughly 50 cents per 100 Linden dollars. Most game companies - and gamers - frown on buying gold from gold farmers, but when there's an easy way to get your hands on stuff, people will be sure to flock to it.

So if the report comes out on the side of the IRS and virtual loot is deemed to have real value since it can be sold for real money, will we be seeing the government concluding that every time a fallen virtual monster gives up its prize a taxable event has occurred? Click on the "read" link below to read the full story at PC World.