“It’s taxable, subject to income tax,” these words from the Department of Finance (DOF) regarding Axie Infinity stirred mixed reactions among the netizens.
For context, Axie Infinity is a cross-platform game fundamentally inspired by Pokémon and Tamagotchi. The game lets players collect, catch, trade, breed, and battle with cute yet powerful creatures called “Axies” with unique skills. This is unique from other games because players can earn passive money here, incorporating non-fungible tokens (NFTs) and blockchain technology.
It’s created by a Vietnam-based developer, Sky Mavis, and is not yet officially registered in the Philippines. However, the DOF said it must pay taxes for any revenue earned from local sources— Filipino players. Hence, earnings converted from cryptocurrency to pesos will be taxed.
One would assume that netizens are furious to hear that Axie Infinity is “taxable,” but that barely scratched the surface.
If anything, lots of netizens have actually had a well-thought-out response to this, stating concerns that it would prove extremely difficult to implement given its crypto nature and that it would be a logistical nightmare, generally speaking.
We are not trading securities.
— Psycheout – Aleksander | Axie Infinity (@Psycheout86) August 24, 2021
Others also argued that the game could not be taxable as the company behind it is not registered with the Securities & Exchange Commission (SEC) nor a license to sell or trade securities despite the finance department being adamant that it is taxable.
Alternatively, netizens posit the game is taxable in theory but nearly impossible in practice as there are no regulations nor documents to back the taxation. They suggested that it’s all up to the players of the game to pay or not.
Overall, netizens expressed tolerance, if not agreement, to the imposed taxation of a play-to-earn game that provides an alternative earnings among the financially challenged during this pandemic.
To them, there’s no issue in paying taxes for this is a responsibility as being citizens. However, what makes them shake their heads is that taxes are not used as they should— to benefit the very people paying them and to make the country prosper.
Just as Benjamin Franklin said once, “Nothing is certain except death and taxes.”