Friday, November 16, 2012

PI taxes and avoiding them

In nullsec, I'm more and more getting involved in Planetary Interaction, one of the few industrial ways of playing EVE. PI is in a special position: at the one hand it's fully PVE, you don't need other players to do it (besides buyers for your product). On the other hand it's not farmable. You can rat 10 hours straight, your 10th hour will be just as productive as the first (unless you did not uninstall the game after the third), but you can't do PI 10 hours. If your planets are set, all you can do is restarting your extractors and haul the materials. If it's done, you are done for the day. For this reason PI isn't really popular among the masses: they usually don't make money regularly, and when they want to make money, they want that money now. So PI is more likely a side business for industrialists.

However there is a serious problem with PI: taxes. Missioning and ratting is also taxed but PI is very different, by taxing the intermediate products. If you have 10% ratting tax, you pay 10% of your income to your corporation. If you have 10% PI tax, you pay tax every time you move something between planets. With the highsec 10% tax you pay:
  • P1: 50 export, 25 import (P1 is like water, not aqueous liquids, that's P0)
  • P2: 900 export, 450 import
  • P3: 7000 export, 3500 import
  • P4: 270K export, 135K import
As you can see it has nothing to do with the market value of the item. But the main problem comes with the standard PI setup, having P1 planets (extractors and P1 factories) and high P factories. If you have P2 production, like coolant, you pay the following taxes:
  • Exporting 8 water from your water planet, 400 ISK
  • Exporting 8 electrolytes from your electrolyte planet: 400 ISK
  • Importing the above to your P2 planet: 400 ISK
  • Exporting the completed coolant: 900 ISK
All together 2100 ISK, which is about 25% of the sell price of coolant.

Tax isn't an issue because this number is big. Tax is an issue, because it make people prefer low-movement planet setups. Goonswarm for some weird reason has 15% PI tax, making the above coolant scheme pay 3250ISK. No wonder that on the Goon forums this scheme is unadvised and rather the one-planet P2 is advertised: find a planet which has both materials, put down two extractors, power lines from these distant extractor to the processors where both materials are refined to P1 and combined to P2. This setup obviously inferior to the previous as it locks the player to a few planets (that have both resources), forces him to run two underutilized extractors (A 1-head extractor takes 3150 powergrid, a 10-head takes 8100 and extracts 10x more) and forces him to have long power lines. Still it's better than paying tax. This is only possible for high-skill players, as low-skilled ones (newbies) simply don't have the powergrid to run such beast. For this reason low PI taxes are necessary to make newbie-PI running. The low-skilled planets can run extractors and P1 factories, but not high-P factories as the low skill cuts CPU harder than PG. Newbies shall provide P1 for more skilled players but they can only do so if tax is low.

However instead of whining over tax, let me suggest a PI scheme where you can minimize your tax without giving up flexibility or optimization and the ability to buy materials from others instead of doing everything yourself:
This factory is built on a planet with aqueous liquids only. There is an extractor, feeding this to the command center that serves as storage. It's surrounded by P1 factories that refine it to water. The launchpad gets electrolytes imported and water received from the P1 factories. The P2 factories surrounding it taking them out and using them to create coolants. You just have to look out for one thing: never fill the launchpad with electrolytes or it jams. Always leave at least as much space empty as needed for one batch of water. With this setup you pay taxes for electrolyte export somewhere else, import here, coolant export here. 600 ISK tax saved in highsec, 300 in 5% TEST space, 900 for Goons.

However the biggest gain of this setup is that you don't have to bother extracting electrolytes at all, you can just buy it, leaving the simple job of P1 extraction to newbies. However this rises the question why extract water and not electrolytes? I mean the water is cheaper than the electrolytes, you would be better off living on an electrolyte planet and buying cheap water. It's wrong. Electrolytes are more expensive exactly because they are less abundant and more wanted. It means that electrolyte planets are harder to find and more likely be over-harvested by others. Since both of them comes from equal PI steps, we can be sure that their price reflects the difficulty of getting them. Do you want to spend time relocating your factories? If you do, then forget P2 and be a professional P1 farmer, transforming your time moving factories into high-ISK income. If you prefer high ISK/hour over high ISK/day, stick to the cheap P1. No one will come to your planet and fight for water.

What if your end product is P3? Since exporting 2x8 P1 is 800 while exporting 1 P2 is 900, the optimal setup here is having P1 planets (or buying P1) and importing them on a factory planet which process it to P2 and then P3. Placing extractor on such planet is generally not a good idea due to low extractor utilization.

In case of P4 the tax-optimal is still P1 import, however it might need some seriously complicated planet and importing awful lot of different materials. 1 unit of P2 takes 4 times more space than the P1 materials it is created from. So you are maybe better off with P2 import, getting P2 from the above shown factory planets and combining them to P3 then P4 on the planet.

PS: The P0 (like aqueous liquids) needed to make one unit of P1 take up 4x more space. Since you can't use P0 for anything else then making one type of P1, exporting P0 from a planet is always a stupid idea.

Friday morning report: 173.7B (8.6 spent on main accounts, 7.1 spent on Logi/Carrier, 3.8 on Ragnarok, 5.5 on Rorqual, 3.4 on Nyx, 3.4 on Dread, 57.4 sent as gift)


Foo said...

There are exceptions to *always* converting P0 to P1; and I refer you back to an earlier post of yours regarding autotrophs.

I am not certain why (apart from maybe price manipulation), but listing a few (in this case 100,000's) of autotrophs has some value.

If someone is desperate for overpriced mats, it only serves all involved to provide them.

sunatzero said...

"Electrolyte planets are harder to find and more likely be over-harvested by others."

This might be case in overpopulated high sec. I doubt it's in the rest of the galaxy. "Over harvested" isn't the problem. You just have to make a balance on the amounts you harvest. So you extract/make the same amounts of water as electrolytes.

Micah said...

The point of the goon setup is to run 2 P2s if you have CCU IV or 3 P2s if you have CCU V so you only have to reset once a week and haul two or three times a month.

Trying to haul around P1s or even resetting extractors once a day is too high effort for something so shockingly boring and terrible as PI.

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