FINALLY the UK is catching up with other major games developing nations by introducing tax incentives. This will hopefully allow the industry to be a bit more free with their creativity and development and hopefully also increase our pay a bit!
Chancellor George Osborne has promised the corporation tax reliefs for the video game industry will be “among the most generous in the world” in his autumn statement today.
Following consultation on their design, the government will ensure that the reliefs are among the most generous in the world by offering a payable tax credit for all three reliefs worth 25 per cent of qualifying expenditure,” said the official statement from the treasury.
The corporation tax reliefs for the creative sector, which also includes animation and television production, will still come into effect from April 13, and will offer qualifying companies the chance to, “choose between an additional deduction at a rate of 100 per cent of enhanceable expenditure or a payable tax credit at a rate of 25 per cent of qualifying losses surrendered.”
“Having run an independent games development and publishing company for many years, seeing this happen is great and long overdue news”
Andy Payne, chairman, UKIE
The statement also promised further investment in the existing Skills Investment Fund administered by Creative Skillset over the next two years, which will add video games to its remit. The government will match industry contributions of up to £6 million over the next two years.
The statement also announced a reduction in the main corporation tax to 21 per cent next year, better broadband for UK cities and £600 million in science research spending.
“Tax breaks for games production will ensure that the UK remains a world leader in the high technology video games development industry. A single 25 per cent level of relief will be simple to administer and economically impactful. Yet we will have to monitor the actions of our competitors: the province of Quebec in Canada already boasts a 37.5 per cent level of tax relief,” said TIGA’s Dr Richard Wilson, who also hoped the measure would help make high skill, export focused industries a bigger player in the UK economy.