Here’s the latest action:

vctax.bmpVCs may be vulnerable to new tax idea — Federal lawmakers are mulling a rule that would make venture capitalists pay much more in taxes. So far, venture capitalists’ profits have been classified as capital gains– and thus subject to the capital gains tax of 15 percent. However, under the proposal being mulled by Charles Grassley of Iowa, the ranking Republican on the Senate Finance Committee, those profits would be classified as ordinary income, and therefore subject to the income tax of 35 percent, assuming they’ll be in the highest tax bracket. Two law firms, Paul Weiss and Debevoise Plimpton, sent out warnings to clients about the tax proposal idea. The move by high-profile venture firm Sequoia Capital and other firms to eject public investors from participating in their funds a few years ago didn’t help the VC cause much.

Skype rolls out call-payment service — If you want to sell your expertise by phone, you can use Skype voice or video and charge people using PayPal. You can charge these people either a one-off fee or by the minute. Skype keeps a 30 percent fee, which seems excessive, compared to lower 15 percent commission charged by Ether and others. See Skype Prime

FM Publishing seeking sale — An executive at FM Publishing, the company that runs an ad network serving tech blogs and other sites (VentureBeat is a customer), says it has gotten $4.5M in revenue, the first year of operation, and its a good time for someone to buy it before the price goes up, according to a report leaked to Techcrunch. FM’s chief executive John Battelle, however, says the comments were made off-the-record, and that he doesn’t plan to sell anytime soon.

Microsoft’s search pains continue — Despite vowing three years ago to catch up to Google in search, Microsoft continues to get drubbed. Now Chris Payne, 38, who was corporate vice president of Microsoft’s search efforts, Windows Live search, is leaving the company to launch his own.

Friendster switches to GoogleFriendster, the social networking company, has switched to Google as its search engine advertising supplier, ditching Yahoo in the process.

Agloco now several weeks late on its ViewbarAgloco, a start-up that promises to help make people money by letting them use an Agloco Viewbar while they surf the Web, has failed to release its Viewbar on schedule. Back on Dec 20, the company said it would come in seven to ten weeks. Now, in a statement sent out to members, Agloco says it’ll still be a few more weeks. However, more and more people are signing up for the service. The company saw a record number of new sign-ups last week, it said.

emotiv.bmpEmotiv’s brain-reading headset — San Francisco-based start-up Emotiv Systems hopes to release a headset next year which will detect thoughts through sensors in a helmet, using a brain-computer interface. It then translates them into actions on the screen. It can also detect facial expressions, like a smile or a grimace, and translate those as well. See the Mercury News story by Dean Takahashi. It has raised $6.3 million from Technology Venture Partners, Epicure Capital Partners and the Australian Federal Government.