Philippine govt says Axie Infinity players to pay taxes for trading ‘pets’

Details:

• During Covid-fueled lockdowns, thousands of Filipinos got hooked to play-to-earn games like Axie Infinity, in which players earn cryptocurrency and non-fungible tokens (NFTs) by breeding and trading fantasy creatures called axies.
• While players cannot yet monetize the NFTs, they can make money in the game itself by trading these digital pets online – an activity that generates thousands of pesos. Regardless of whether axies were paid for by money or in kind, the DOF declared these transactions as taxable.

Dive deeper:

• As a non-resident foreign corporation, Axie Infinity’s Vietnamese developer Sky Mavis’ earnings from the game cannot be calculated Philippine tax authorities currently. (Read: Explaining Axie Infinity and its mercurial rise)
• Axie Infinity is one of the highest-grossing blockchain games in the world (Read: Why Axie Infinity is no Ponzi scheme). The popularity of such games has also led to the rise of several decentralized gaming guilds in the Philippines, including Yield Guild Games, which helps cash-strapped people join the fast-growing community. (Read: A16z’s first Philippine bet is shaking up blockchain gaming)