Original URL: http://www.theregister.co.uk/2010/06/28/games_tax_break_killer_claim/

'Industry giant' fragged UK games developer tax break

Website claims govt bowed to big-player pressure

By Tony Smith

Posted in Games, 28th June 2010 10:12 GMT

Why did the Liberal Conservatives can a plan to give UK games developers tax breaks? Because "one of the biggest games companies in the world" persuaded them not to.

So claims game creation website Develop, though it doesn't feel able to say which major developer leaned on the Treasury despite having "multiple, very trusted sources" for the allegation.

The way said sources tell it, the unnamed industry giant was opposed to the tax break, announced by then Chancellor of the Exchequer Alistair Darling in has March 2010 budget. The company feels that such a move would have given the UK games industry an unfair competitive advantage.

An advantage, we'd point out, like the ones provided to developers in France, Canada, South Korea and a number of other territories to which games development is migrating because of the financial incentives the governments of those countries provide.

UK trade associations have been lobbying for similar tax benefits for some years. Had Darling's plan gone ahead, the new tax break would have come into force next year. But new Chancellor George Osborne pulled the plug on the plan during his budget earlier this month.

The Treasury's own figures put the saving to be made from cancelling the planned tax break at £190m over the tax years 2011 to 2015 - not exactly a huge chunk out of the multi-billion pound national debt reduction plan. ®