Because:

A. They can get away with it

B. Stores like Game and Gamestation merging mean (see A.)

Whot?!

That's ridiculous! 

Here in finland i found Heavenly Sword in many stores at price 75€.(107$)

This question has been answered so many time. Europe has very high taxes, lots of regulation, expensive markets to enter, much smaller markets, increased shipping costs, and so on...

exchange rate is the main reason I believe, from 1.00 (EUR/USD) not so long ago to 1.45 roughly now that's a 45% increase so...
Good side of things : buying things over the net from the US is very attractive those days for us in Europe

Here (switzerland) there are very low taxes on electronics, the games have always costed around 100 CHF, which is 86 USD as of today's rate compared to 55/65 USD few years back

Here in Sweden an average Wii game costs 500 SEK ($76 US) but for some reason more popular games like Zelda costs 649 SEK ($99 US).

Guitar Hero III for Wii is actually the most I've spent on ONE video game: 849 SEK ($130 US)
Wii fit will probably be priced like GH3 or maybe even higher.

The fact of the matter is the pound is doing very well against the US dollar at the moment, so trying to compare games bought in the UK with UK money with the US Dollar is almost pointless

If tomorrow the US Dollar fell to 50 dollars to 1 UK pound it would be mighty silly going around complaining that UK games work out to be 2000 dollars without looking at the overall US economy.

Also given this is in the Nintendo section I've got to ask were are you people buying your Wii games. Last game I picked up was Mario Galaxy at launch and that cost me £24.00 after discounts and refunds which is a lot short of £40.00

I don't really mind but then again I live in rich Norway.