‘The rise of the metaverse also raises numerous tax questions’ – Taxes

‘Federal Public Service Funding may well be progressive and virtual offices will certainly have their place in government as well. But at the same time, the service must show the same progressivity towards taxpayers and provide legal certainty for the fascinating tax discussions that will arise’. So says Michel Maus, lawyer and professor of tax law.

The website of the Federal Public Finance Service recently reported that from now on taxpayers will also be received by virtual public servants. This is a three-month pilot project at the information centers in Antwerp and Liège. Public officials will speak to taxpayers in the form of a hologram. A hologram is a three-dimensional image or video of an object or person. If you’ve seen the first Star Wars movie from 1977, you might remember the magical scene where the robot R2D2 projects Princess Leia as a hologram and with the epic words “Help me Obi-Wan Kenobi, you are my only hope“, asks the rebels for help. Whether Princess Leia was the inspiration for Finance is probably doubtful, the fact is that with this project the federal public service is taking a step into the metaverse, the virtual world that is considered the successor of the Internet .

The project fits with the ambitions of the Ministry of Finance to merge digitization with the preference of some taxpayers for ‘physical’ contacts. If the test is successful, according to the press release, taxpayers will no longer have to go to federal public service offices. Finally, the press release states that the hologram can in principle also be projected in the taxpayer’s home or office, so that the tax authorities will be “even more easily accessible.”

The rise of the metaverse also raises numerous fiscal questions.

In itself it is a good thing that Finance anticipates technological developments. It is expected that in a few years we will be communicating and interacting with each other both privately and professionally through avatars in the metaverse, and buying products in 3D web stores en masse. The fact that tax authorities are already taking the step towards virtual civil service can be called far-sighted and should be encouraged. The question, however, is whether taxpayers see this too, and what their reaction will be if they are faced with a virtual version of their tax officer.

The rise of the metaverse also raises numerous fiscal questions that currently remain unanswered. The Ministry of Finance must provide for this and provide legal certainty with circulars. Otherwise, as with the cryptocurrency boom, there is a risk of a battle with the ruling service that ultimately only benefits tax advisors. For example, there is the question of the depreciability of virtual land. If a company wants to build a 3D office, showroom, or exhibit space in the metaverse, they must first purchase virtual land. Physical land is not depreciable, but what about virtual land? The same goes for creating virtual buildings. In the real world, buildings must be depreciated over at least twenty years, but what about virtual buildings? And if a company has set up a 3D store in, say, Threedee World or Decentraland, where is this store located? Is that the country where the company is located, or is it the country where Threedee World or Decentraland are located, or even the country where the servers running these 3D worlds are located?

The Treasury of the Federal Public Service may well be progressive and virtual offices will surely have their place in government as well. But at the same time, the service must show the same progressivity towards taxpayers and provide legal certainty for the fascinating tax discussions that will arise. It is time to pay attention to that.

The website of the Federal Public Finance Service recently reported that from now on taxpayers will also be received by virtual public servants. This is a three-month pilot project at the information centers in Antwerp and Liège. Public officials will speak to taxpayers in the form of a hologram. A hologram is a three-dimensional image or video of an object or person. If you’ve seen the first Star Wars movie from 1977, you might remember the magical scene where the robot R2D2 projects Princess Leia as a hologram and with the epic words “Help me Obi-Wan Kenobi, you’re my only hope”, ask the rebels for help. It is doubtful that Princess Leia was the inspiration for Finance, but the truth is that with this project the federal public service is taking a step towards the metaverse, the virtual world that is considered to be the successor of the internet. the ambitions of the Treasury in digitization with the preference of some taxpayers for ‘physical’ contacts. If the test is successful, according to the press release, taxpayers will no longer have to go to federal public service offices. Finally, the press release states that the hologram can in principle also be projected in the taxpayer’s home or office, so that the tax authorities will be “even more easily accessible.” It is expected that in a few years we will be communicating and interacting with each other both privately and professionally through avatars in the metaverse, and buying products in 3D web stores en masse. The fact that tax authorities are already taking the step towards virtual civil service can be called far-sighted and should be encouraged. The question, however, is whether taxpayers see it that way, and what their reaction will be if faced with a virtual version of their tax official. The rise of the metaverse also raises numerous tax questions that currently remain unanswered. The Ministry of Finance must provide for this and provide legal certainty with circulars. Otherwise, as with the cryptocurrency boom, there is a risk of a battle with the ruling service that ultimately only benefits tax advisors. For example, there is the question of the depreciability of virtual land. If a company wants to build a 3D office, showroom, or exhibit space in the metaverse, they must first purchase virtual land. Physical land is not depreciable, but what about virtual land? The same goes for creating virtual buildings. In the real world, buildings must be depreciated over at least twenty years, but what about virtual buildings? And if a company has set up a 3D store in, say, Threedee World or Decentraland, where is this store located? Is that the country where the company is located, or is it the country where Threedee World or Decentraland are located, or even the country where the servers running these 3D worlds are located? The Treasury of the Federal Public Service may well be progressive and virtual offices will surely have their place in government as well. But at the same time, the service must show the same progressivity towards taxpayers and provide legal certainty for the fascinating tax discussions that will arise. It is time to pay attention to that.

Leave a Comment