Taxes
One of the 2 things we can never avoid in life.
Why tax?
To sustain the protocol, we need to implement taxes. Taxes will provide the following:
Liquidity
Reserve Fund
Deflationary Measures
Investment Treasury
What are you taxed on?
4% buy/transfer taxes
4% sell tax
Where do the taxes go?
For buying & selling:
2% from buys & 2% from sells will go towards the Investment Treasury which will be used to generate profits by investing for our protocol.
1% from buys & sells will go to the Liquidity Pool.
1% from buys & sells will go to the Reserve Fund, which will hedge against volatility in the market.
Dynamic Tax Tiers
Much as we have to pay homage to our counterpart for this implementation, most countries around the world have tax brackets or tiers. (though some favor the rich, we're not like those)
With Dynamic tax tiers, the whole point is to minimize price manipulation by taxing sells based on how big of a share the holder has in correlation to the Liquidity Pool of AFX. We don't want the whales and big bag holders to dump on the market without consequence. With DTT, it will hopefully deter whales from dumping.
The quantity of AFX tokens you hold is taken into account when calculating how big of a share of the LP you hold. For every 1% that you hold, the tax is increased by 2% until there's a total sell tax of 30%.
A simple calculation:
1% of LP - 2% tax
2% of LP - 4% tax
3% of LP - 6% tax
4% of LP - 8% tax
and so forth till we hit 30% in total tax.
We would also accept OTC deals. Just contact us on discord. :)
Tax Reduction
We will be looking to reduce both buy and sell taxes when our protocol's financial health hits certain milestones. (more to be announced as our protocol grows)
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