If you’re a Filipino gamer, you’ve probably heard of the “play‑to‑earn” (P2E) phenomenon: play a game, earn tokens or NFTs, and cash them out. Sounds like winning while doing what you love, right? But here’s the catch: in the Philippines, your P2E or crypto/NFT earnings may trigger tax obligations—some of them hidden and overlooked. In this blog post we’ll walk you through:

1. How you earn from P2E games.
   
2. Is P2E gaming regulated in the Philippines?
   
3. Do your earnings incur taxes?
   
4. How tax applies to your prizes or earnings from these games.
   
5. Is the “20% tax” real or myth?
   
6. How do you pay your tax on these earnings?
   
7. What taxes apply in simple terms.
   

Let’s get into it—without making it too dry—so you’re equipped, not caught off guard.

Disclaimer: This blog is for informational purposes only and does not constitute tax, legal or financial advice. You should consult with a qualified Philippine tax professional or advisor for your specific situation.

How Do You Earn from Play‑to‑Earn Games?

First, let’s cover the basics of how you could be earning from P2E gaming or NFT gaming.

• You join a game that uses blockchain, crypto tokens or non‑fungible tokens (NFTs) as part of its economy. Think of games like Axie Infinity, where you can earn tokens by playing. (There was a big wave of this in the Philippines. (kryptos.io))
  
• You might earn by completing in‑game tasks, winning competitions, owning in‑game assets (NFTs) that appreciate, staking tokens, or renting/scholar‑king setups (you provide the assets, a “scholar” plays them). The value you earn can be crypto tokens, NFTs which you can sell, or in some cases fiat currency after conversion.
  
• For example, in the Philippines during P2E boom, lots of players earned crypto by playing Axie Infinity and similar games. (National Tax Research Center)
  
• The key: you receive something of value (crypto, tokens redeemable, NFTs) in exchange for your time, effort, game skill, or asset ownership. From a tax perspective, that is “income” or maybe “a gain” or “reward” depending on how you think about it.
  

So if you’re a Filipino gamer earning crypto or NFTs from these games—or receiving prizes, rewards, or assets that you later sell—you likely have something taxable.

Is Play‑to‑Earn Gaming Regulated in the Philippines?

Before diving into taxes, let’s check the regulatory status of P2E gaming and related crypto/asset markets in the Philippines.

• The Philippines has been actively regulating cryptocurrency and digital assets. The Bangko Sentral ng Pilipinas (BSP) and the Securities and Exchange Commission (Philippines) (SEC) have issued guidelines on virtual‑currency exchanges. (Freeman Law)
  
• On tax frameworks: the Department of Finance (Philippines) (DOF) has committed to implementing the global “Crypto‑Asset Reporting Framework” (CARF) by 2028, to fight cross‑border tax evasion of crypto assets. (BitPinas)
  
• On P2E game regulation specifically: There’s less clarity. Games that incorporate NFTs or tokens may fall under the digital‑asset regulation regimes, but there is no fully specific rule labelled “P2E gaming tax/regulation” publicly available. What we do know is that online gaming, gambling, and offshore gaming operators have separate regulatory regimes. For example, the Philippine Amusement and Gaming Corporation (PAGCOR) regulates gambling/ gaming hubs, offshore gaming, etc. (Legal 500)
  
• One caution: some P2E games might blur the line between gaming, speculation, asset‑trading and even gambling. If prizes are significant or monetised, regulators might treat them differently.
  

Bottom line: Yes, there is regulation on crypto and digital assets in the Philippines. But the P2E gaming space is still grey in some respects—meaning your earnings may fall under existing tax regimes even if the game itself doesn’t have a dedicated rule.

Does Your Earnings Have Taxes?

Short answer: yes, your earnings can have taxes. This depends on how the tax code treats what you earned (income, capital gain, prize, etc). Let’s break it down.

• Under general tax principles in the Philippines, all income derived from whatever source is subject to income tax unless exempt. That means: if you earned tokens/NFTs from gaming, you received something of value; that’s likely “gross income” and should be declared. (Grant Thornton Philippines)
  
• For crypto assets: The Philippines recognizes these as digital/virtual assets and they may be taxed as capital assets or ordinary assets, depending on holding period, activity and classification. (PwC)
  
• For winnings / prizes: If the game rewards you in crypto or NFTs, it might be treated like a “prize or winnings.” In the Philippines, prizes and winnings (for instance from sweepstakes or lotteries) are taxed at 20% for winnings over ₱10,000. (Wikipedia)
  
• So yes, your P2E earnings may trigger tax obligations—either income tax, capital gains tax, perhaps VAT (if you’re trading assets) or prize‑winning tax.
  

It’s critical: just because the game pays you in crypto or NFTs doesn’t mean “tax‑free.” The tax code doesn’t always have special P2E rules, so the standard tax rules apply.

How Is Tax Being Applied to Your Prizes or Earnings from These Games?

Let’s walk through how tax authorities in the Philippines might view your P2E earnings, and what taxes could apply. I’ll use scenarios to illustrate.

Scenario A: You play a P2E game and earn tokens/crypto that you later convert to fiat

• You earned tokens in exchange for playing.
  
• Later you sold the tokens or exchanged them to fiat.
  
• Tax implications:
  
  • The initial reward can be considered income when you received it (fair market value at receipt).
    
  • When you sell the tokens, you may have a capital gain (i.e., difference between cost basis and sale value). In the Philippines capital gains tax (CGT) up to ~15% may apply to crypto sales. (kryptos.io)
    
  • If you’re trading or operating as a business (e.g., you systematically play games to earn tokens and sell), the income could be “ordinary income” and subject to income tax (progressive up to 35%). (Regtechtimes)
    
  • If you sold to another person or provided a service (playing is service) you may trigger VAT or percentage tax if you’re registered as business. For example, digital services in PH are subject to VAT 12% in some cases. (BitPinas)
    

Scenario B: You win an NFT or token as a prize in the game (e.g., tournament win)

• You won something of value (crypto/NFT) based on performance.
  
• How tax applies:
  
  • This is analogous to a prize or winning. In PH, winnings above ₱10,000 are taxed at 20%. (GGRAsia)
    
  • The fair market value of the token/NFT at time of receipt is important—they’ll likely treat that as the taxable amount.
    
  • If you later sell the NFT/token, another layer (capital gain or income) might apply.
    

Scenario C: You run a “scholar” system: you own assets, someone plays for you, you get share of earnings

• Here you are providing capital (asset ownership) or service (management) in the game.
  
• Earnings you get from that setup are income for you—just like royalties or lease income. Regular income tax would apply.
  

In short: multiple tax dimensions may apply—income tax, capital gains tax, VAT/percentage tax, prize‑winning tax. The exact combination depends on facts: how you earned it, how you convert it, if you trade it, if you act as business.

Is “20% Tax” Real?

Many gamers ask: “I heard 20% tax on winnings—is that real?” The short answer: yes in some cases, but it doesn’t cover all P2E situations and you shouldn’t assume 20% applies universally.

• The 20% rate comes from the Philippine tax code for prizes and winnings: “prizes and winnings from sweepstakes and lotteries… in excess of ₱10,000” are taxed at 20%. (Wikipedia)
  
• But if your earnings are not a “prize or lottery” but instead token income, capital gains, business income, or trading profits—they may be taxed under different rates: income tax (progressive up to 35%), CGT (~15%), VAT, etc. (Regtechtimes)
  
• The 20% rule is not exclusively for P2E games—it applies to certain “prize/winnings” categories. If you’re playing a game and earning crypto tokens, each situation should be evaluated.
  

So yes the 20% tax is real but limited in scope. If you simply get a prize from a game (above ₱10,000) then yes you might face 20% final tax. But don’t assume that covers you if you trade, convert, or earn regularly.

How to Pay My Tax on These Earnings?

If you earn crypto/NFTs from gaming and want to stay compliant, here’s a simplified roadmap for how to handle taxes in the Philippines.

1. Keep detailed records
   
   • Record when you received tokens/NFTs, their fair market value in PHP at time of receipt.
     
   • Record when you sold or converted tokens/NFTs, the sale price, costs/fees.
     
   • If you received “prizes,” record the date, value, what you got.
     
   • If you’re earning regularly or as business, treat it like business income and track relevant costs.
     
2. Determine what kind of tax applies
   
   • Is it a one‑time prize? Then prize‑winning tax (20% above threshold) may apply.
     
   • Is it income from playing, trading, renting assets? Then income tax may apply.
     
   • Did you sell crypto or NFTs? Then capital gains tax or ordinary income tax may apply.
     
   • Did you carry out as business (regular activity)? Then normal business tax rules (income tax, VAT/percentage tax) may apply.
     
3. Report the income on your annual tax return
   
   • Include the earned value in your gross income. In Philippines your tax code says “all income derived from whatever source.” (Grant Thornton Philippines)
     
   • Pay the appropriate tax—income tax brackets: 0%‑35% depending on income level. (Regtechtimes)
     
   • If capital gains rules apply, use the appropriate CGT (e.g., ~15% for crypto sales) (kryptos.io)
     
   • If you are registered as business, file VAT or Percentage Tax accordingly.
     
4. Withholding or final tax
   
   • If you get a prize/winning, the payer (game operator) may withhold the final tax (20%). If not withheld, you are still liable.
     
   • For crypto earnings, since rules are less explicit, you might need to self‑assess or consult a tax advisor.
     
5. Pay on or before deadlines
   
   • The regular annual income tax return (for individuals) is filed and paid at particular deadlines (e.g., for annual income).
     
   • If you’re a business, there may be quarterly returns/payments for VAT, percentage tax.
     
   • If you owe final tax on a prize, pay it when due.
     
6. Seek professional advice
   
   • Given the evolving nature of crypto and P2E gaming, it’s wise to consult with a tax professional familiar with Philippine tax law.
     

What Are the Applicable Taxes in Simple Terms?

Let’s put it all in simple bullet form—what taxes could apply and when.

Key takeaways (simple):

• If you earn crypto from P2E gaming, treat it like either income or prize/winnings depending on facts.
  
• If you later sell that crypto/NFT, watch for capital gains.
  
• Don’t assume “tax doesn’t apply.” The law says income from whatever source is taxable.
  
• If you’re doing it seriously (like business), you may be under more complex tax rules.
  
• 20% tax applies only in prize/winning contexts—not automatically for all P2E/crypto income.
  

Practical Steps for Filipino Gamers & NFT Earners

Here are actionable steps you can take if you’re playing P2E games and earning crypto/NFTs.

1. Track everything: date you earned, what you earned, fair value in PHP at that time, how you disposed it (sold, converted).
   
2. Self‑assess your status: Are you casually earning? Or systematically playing as business? The latter may mean business tax obligations.
   
3. Check threshold for prize/winnings tax: If you won a large tournament or value > ₱10,000, you may need to pay 20% final tax.
   
4. If you sell crypto later: Treat sale as taxable when you converted to fiat or swapped for value—and watch for capital gain.
   
5. File annual return: Include the income in your annual tax return; if business, file accordingly.
   
6. Pay tax on time: Don’t wait. Non‑compliance leads to fines, interest and audit risk.
   
7. Consult a tax expert: Especially for newer areas like P2E gaming + crypto. The rules are evolving (for example, the DOF’s commitment to CARF by 2028). (Department of Finance)
   
8. Stay updated: Regulation and tax frameworks are shifting. What was unclear yesterday may get formalised tomorrow (crypto asset regulation, global tax frameworks).
   
9. Be compliant even if small: Even smaller earnings may trigger tax—being early compliant is better than dealing with audit later.
   

Why This Matters for You

If you’re a Filipino gamer or NFT‑earner, here’s why you should care:

• You may owe taxes even if you think “it’s just a game.” The tax code doesn’t care if you earned it “just for fun.”
  
• The value of your assets might grow, so your tax exposure grows. If you earned an NFT today and it rallies tomorrow, selling it means you may owe on the gain.
  
• Regulators are watching. The Philippines’ DOF is stepping up crypto‑asset monitoring and reporting frameworks. (BitPinas)
  
• Compliance now avoids headaches later. Better to have your records, disclosures, and taxes in order before an audit knocks.
  
• Gaming incomes may shift from casual to business. If you repeatedly earn from P2E games, you might be treated as running a “business” for tax purposes—with higher obligations.
  
• Tax optimisation is possible (legally). Knowing how your earnings are taxed lets you plan (e.g., when you sell, how you structure your activity).
  
• It’s part of the ecosystem growth. P2E + NFTs are part of the digital economy—when governments treat them seriously, you want to be ahead.
  

In the Philippines, P2E games and crypto/NFT earnings offer exciting opportunities—but they also bring tax responsibility. You might think “I’m just playing a game,” but the tax authorities will view what you earn as income, prize, capital gain or a business activity—depending on the facts.

Remember:

• Earned tokens/NFTs from playing? Probably taxable as income.
  
• Sold those tokens/NFTs? Possibly capital gains tax.
  
• Won a tournament or got a major prize? Prize tax (20% over threshold) may apply.
  
• Doing this regularly and trading? Business income, VAT/percentage tax may apply.
  
• Regulation is still evolving—so stay informed.
  

If you’re a Filipino gamer earning crypto or NFTs: track your earnings, ask the right questions, and pay your fair share of tax. Better to be compliant and confident than caught in a tax trap.

Disclaimer: This blog is for informational purposes only and does not constitute tax, legal or financial advice. You should consult with a qualified Philippine tax professional or advisor for your specific situation.