UK Gaming Industry Body Calls For Urgent Tax Breaks

by Amanda Banks, Tax-News.com, London

02 November 2009

The UK's video games industry is lobbying the country's government for tax relief, to ensure a level playing field with its overseas competitors, who currently benefit from generous tax regimes.

TIGA (The Independent Games Developers Association), the body at the forefront of discussions, presented its findings on October 27, warning that unless the UK introduces tax relief for the game development sector, the industry will likely shrink by 5% yearly for the next five years.

Gareth Edmondson, Vice-Chairman of TIGA, Managing Director of Ubisoft Reflections, announced in a recent speech that:

“The UK games industry is still successful and world leading. However, because most of our key competitors benefit from a tax break for games production, our industry is at a competitive disadvantage. Unless the UK government introduces TIGA’s proposed Games Tax Relief, our research suggests that employment in the development sector will fall by 5% in each of the next five years, from 9,025 in 2009 to 7,351 in 2014. There would also be a fall of GBP1.9m in development expenditure over the same period.”

“In contrast, with Games Tax Relief enacted, the industry would stop shrinking in 2010, grow by 2% in 2011 and by 4% in each of the next three years. 3,550 graduate level jobs and GBP457m of investments in the development sector would be created or protected with the advent of the tax break. Games Tax Relief would more than pay for itself. Over five years the tax measure would cost GBP192m but would deliver GBP415m in tax receipts.”

Concluding his speech, delivered at the 'Best of British’ GameHorizon-hosted event in London on October 28th, Edmondson observed that:

“The UK government has a clear choice: invest in an inherently successful industry to perpetuate our leading position in the world, or preside over the decline of a key knowledge industry.”

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