Axie Infinity issued a statement in response to the call of tax regulators in the Philippines that earnings from the game, SLP, should be subject to income tax. Moreover, the government is also looking into sanctioning the development studio behind the game, Sky Mavis.
Will The Philippines tax SLP?
Last week, we reported that Finance Undersecretary Antonette Tionko reminded Filipino Axie players that they are “mandated to report as income and pay the taxes for whatever they generate from cryptocurrency platforms.” The government expects players to self-report how much they earn. In the case of Axie Infinity players, you calculate your earnings based on the peso price when you convert your SLP back to fiat currency.
Furthermore, Tionko indicated that the Bureau of Internal Revenue is planning to create a registration system for foreign companies like Axie Infinity in order to collect taxes from their activities.
Breaking Down Axie Infinity’s Statement
Filipino players account for 40% of Axie Infinity’s total players. Due to the importance, Sky Mavis swiftly responded by releasing a statement.
Basically, the Vietnamese devs behind the successful play-to-earn game encouraged players to comply with local laws. Meanwhile, they also expressed intent to work with governments to encourage innovation for Axie Infinity’s future.
Sky Mavis posted the statement on Twitter. It reads, “We take pride in providing a fun and entertaining experience while cultivating a player-owned ecosystem.”
The team also highlighted that they are proud that their players can earn income through the Axie Infinity game. This is particularly true in the Philippines because the game has been a means to put food on the table. To illustrate, SLP (Axie Infinity’s native token) is valued at $.14 at the moment, meaning 200 SLP is around $28. This may not sound like much, but in the Philippines, this is already triple the minimum daily wage. Many players are starting to worry about a tax on SLP.
However, Sky Mavis and Axie Infinity players can still breathe easy as there is no new tax on SLP. Right now, the statement from the developers is more of a means to appease the community. However, this is a positive approach as many players rely on the game as their primary source of income and Sky Mavis appreciate the blockchain game’s significance.