INTRODUCTION
For those who do not know, dCity is a game you can find on the HIVE blockchain where you can earn rewards for building and managing a virtual city, as well as owing NFT's representing game assets which are yours to buy, sell or transfer as you please. In dCity, you can generate earnings in different Hive-Engine tokens [such as SIM (the games native utility token), WEED, BEER, ENTRY and GAMER] and as your City grows you can also earn native HIVE tokens.
In managing your city, just like in real life, you must pay taxes on the income generated by your city. However, not long ago, taxes in dCity were dramatically raised and some long time game participants complained that the taxes were excessive. In fact, at one point taxes were assessed at 100% resulting in no earnings on a players assets invested in the game.
Game taxes are still very high, but are below 100% (usually running in the 90% range). So in this supplement to the dCity Coin Guide, let's investigate several common questions concerning taxes in the dCity ecosystem.
HOW IN THE HELL IS THE TAX RATE SET IN DCITY?
Within the mechanics of dCity, every 14 days, there is a vote of the players to choose a new President.
The most important job of the President is the influence the position has over setting the amount of taxes paid in the game. The President can increase/decrease income taxes, increase/decrease war tax, and turn on or off the following taxes: police tax, education tax, art tax, eco tax and jobs tax.
Additionally, players have the ability to lobby the candidates on four issues, two of which are tax related: income tax reduction and war tax adjustments.
Using the City tab and then the map tab, you access the bubble map of your city together with all of the relevant statistics necessary for you to manage your city. From the statistics (left side of your screen) you can access the current daily tax assessment imposed on your city.
THE PROS AND CONS OF HIGH TAXES
Your author presents this section of the article for your review and consideration. It is up to you to make a determination where you stand of the subject of ultra high taxes imposed in dCity.
THE PROS ASSOCIATED WITH HIGH GAME TAXES
- High taxes help to reduce SIM token inflation, which in turn should increase (or at least maintain) the value of the SIM token for the investors benefit.
- High taxes help to insure the sustainability of dCity moving forward into the future.
THE CONS ASSOCIATED WITH HIGH GAME TAXES
- High taxes may discourage new players thinking they will not produce sufficient income to justify their investment.
- Current active dCity participants may get put off by the high taxes and the resultant decrease in their earnings potential. They may either stop investing in the game and continue to merely collect, or, worse case, may sell off their assets and leave dCity entirely.
IS IT POSSIBLE TO EARN A POSITIVE RETURN ON INVESTING IN DCITY WITH THE HIGH TAXES
The answer to this question is a resounding YES!
However there is a caveat to this. Patience is required in order to realize a positive return in dCity, Once the investment is made in an game asset, that asset is yours and will continue to earn you daily income until you dispose of it. Patience enters the picture as the higher taxes will increase the amount of time necessary for you to recoup your investment. But once recouped, that asset will continue to return you positive earnings and move you into the black.
So basically, the more you invest, the greater your return will be, but you will be required to wait longer to realize the gains and income due to the high taxes.
IS THERE ANY STRATEGY TO LOWER THIS HIGH TAX BURDEN?
YES! One.
You should buy a somewhat pricey Law Firm. Why? Well, the Law Firm gives you a 10% discount on your taxes - daily. Accordingly, if you are seriously into managing a city, the purchase of a Law Firm is a beneficial addition to your city.
CONCLUSION
Even with the high taxes present in dCity, it is still, in your author's opinion, a good investment vehicle for the future production of passive income.
And, your author has put his money where his mouth is on the status of dCity:
Your author's city has outgrown the size of his computer screen.
Enjoy the game and best of luck!
DISCLAIMER: This article is intended as educational content only. It should not in any way be construed as investment advice. Any foregone gains or sustained loss by you in relation to dCity are yours and yours alone and shall not be imputed to this author.