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Games developers demand tax breaks

Or UK videogames biz will slump, says Tiga

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Direct tax breaks for the UK videogame development sector are crucial if the industry is to grow, industry trade body Tiga has claimed.

Tiga’s own research has revealed that if the government fails to introduce a “Games Tax Relief” (GTR), the sector’s employment figure – currently estimated at just over 9000 people - will decline by five per cent each year for the next five years.

Over five years, a GTR would cost the government £192m ($314m/€211m), Tiga said. However, it claimed the measure would yield £415m ($679m/€457m) in tax receipts over the same period.

Gareth Edmondson, Vice Chairman of Tiga, said: “Because most of our key competitors benefit from a tax break for games production, our industry is at a competitive disadvantage.”

Videogames development and publishing is one of the world's most lucrative media businesses, yielding higher sales globally than both movies and music.

If a GTR were introduced in the UK, the sector would next year cease to shrink and enjoy annual growth of two per cent in 2011 and four per cent in each of the following three years, Tiga forecast.

Edmondson claimed that – with a GTR enacted - some “3550 graduate-level jobs and £457m of investments in the development sector would be created or protected”.

Culture Secretary Ben Bradshaw said in June that the government is “looking at introducing further tax breaks” for the games industry, but little has been announced since. ®

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