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Osborne games hope sparks renewed tax breaks lobbying

Mon 21 Feb 2011 11:17am GMT / 6:17am EST / 3:17am PST
Politics

TIGA stepping up efforts following hints of treasury sympathy

TIGA

TIGA is the trade association representing the UKs games industry. The majority of our members are...

tiga.org

UK trade association TIGA is to intensify its ongoing campaign for tax relief, following claims that the government is again considering games industry incentives.

Eidos life president Ian Livingstone last week revealed to GamesIndustry.biz that chancellor George Osborne has offered an olive branch to the industry ahead of possible support in his next Budget, due March 23.

TIGA, which prepared the case for tax breaks that Osborne ultimately rejected last year, is now stepping up its lobbying in response.

Claimed TIGA boss Richard Wilson, "TIGA's Games Tax Relief makes economic sense. We anticipate over 5 years that Games Tax Relief would create or safeguard 9519 direct and indirect jobs (including 3366 jobs in the games industry), 431 million investment in development expenditure, 394 million in tax receipts to HM Treasury, at a cost of 194 million in tax relief to HM Treasury.

Wilso also argued that "TIGA is the only trade association to have consistently argued for Video Games Tax Relief - in public and in private.

"We urge game developers and publishers to join TIGA and to actively support our campaign in the weeks leading up to the Budget."

Added TIGA chairman and Rebellion CEO Jason Kinglsey, "We will be making a strong, positive case for Games Tax Relief, enhanced R&D tax credits and other fiscal measures to the Coalition Government and to other political parties in the run up to the March Budget. We need a Budget for growth."

Another report on Osborne's possible change of heart in the Sunday Times [paywall access required], which referenced tax breaks as costing 30 million a year, has been widely misinterpreted as being the sole extent of the proposed incentives. TIGA's 194 million estimate covers the span of five years - equivalent to 38.8 million per year.

15 Comments

Hmmm.



If the Times is correct, I'm honestly not sure how much good it'll do. It's a drop of what's needed. When Canada's already 30/40% cheaper, using the tax relief to reduce costs by 10-15% won't have much of an impact. Still, here's hoping. One of the concerns I often hear from people is that some unscrupulous studio owners will simply pocket the extra revenue as profit rather than channel it into investment - let's hope that rules are put in place to make sure that doesn't happen.

One other thing - the Canadian provinces seem VERY good at actively going out to attract investment. I know of one studio owner in the last few weeks who's been "invited" to the Canadian High Commission in London. You also always see ads for them - I saw an ad on the Telegraph finance website last week, saying that Ontario was open for business. We could definitely take a leaf out of some of their books when it comes to aggressively trying to take business from other territories.

Edited 1 times. Last edit by Fran Mulhern on 21st February 2011 11:38am

Posted:3 years ago

#1

Edited 1 times. Last edit by Alec Meer on 21st February 2011 11:44am

Posted:3 years ago

#2
Thanks for clarifying Alec.

Posted:3 years ago

#3

James Battersby
Developer

15 8 0.5
Hope this will happen but will wait to the budget announcement before jumping for joy...

Posted:3 years ago

#4

Jas Purewal
Solicitor

35 0 0.0
The Government has also been looking at other measures to assist the creative industries more generally, including the games industry. In particular, it has been examining reforming the R&D tax break system and IP laws more generally.

Therefore, I'd guess that - IF there is to be a games tax break - it will be announced in March as part of a package of measures to boost growth in Britain's creative industries more generally.

Posted:3 years ago

#5

Russell Watson
Senior Designer

86 34 0.4
As always, I'll believe it when I see it.

@Fran
To be honest I believe that is part of the problem with this country as a whole. All we seem to do these days, with everything, is look at what everyone else is doing and then emulating them. Ten years after the fact. It seems as though as our current generation of politicians have no imagination unless it comes to some big gimmicky construction project.

Posted:3 years ago

#6

Kingman Cheng
Illustrator and Animator

951 180 0.2
I'll remain negative about this until shown otherwise.

Posted:3 years ago

#7

Paul Durrant
Director of Business Development

6 1 0.2
@Jas
I think this is the most likely way it will go - particularly when you read the recent comments attributed to Sir James Dyson regarding retargeting R&D tax credits for creative businesses. One can imagine having a much trumpeted "budget for growth" with a high emphasis on technology companies, creative industries, entrepreneurial activities and start-ups and some apparent tax incentives in those areas. The exent to which new money is allocated vs (for example) tighter targeting of (say) R&D tax credits to increase the impact of existing relief on certain categories of beneficiary (eg games developers) remains to be seen. So it could end up as "mutton dressed as lamb" (but there are quite a few "vegetarians " who won't feel any great benefit from that). However, better to think positive around all this I think. I do believe there is a will to improve the games dev business climate - it won't happen Canada style - but if it happens it will the first ever sign of a supportive government policy to build on.

Posted:3 years ago

#8
@ Russell.

Quite. I really think we should have a requirement that MPs must have worked in the private sector for a certain number of years before going into Parliament, and not in the lobbying industry or the PR sector. Our politicians are a joke. Then again, if the electorate get what they deserve, what does that say about the electorate, eh?

Posted:3 years ago

#9

Adam Ross

18 0 0.0
As someone who has studied what impact the tax break for the UK film industry has done for it, any break that can be provided for the games industry in my opinion, is a good thing. Ok so it may not be as great compared to some other countries, however it will go towards evening out the playing field.

However, Im only an aspiring designer, so im sure I dont need to be telling people already in the industry that.

However, with our current Government, it may be best as some people here have suggested to wait for the announcment before jumping for joy.

Edited 1 times. Last edit by Adam Ross on 21st February 2011 5:07pm

Posted:3 years ago

#10

Terence Gage
Freelance writer

1,288 120 0.1
I think I'll echo the cynical sentiments of James and Kingman. I'm pretty sure the Coalition were making similar noises before last year's budget, and that came to nothing, so I'm going to be pessimistic until they give me a reason to be otherwise.

Posted:3 years ago

#11
It would not be surprising to see some sort of fiscal support for the creative industries and specifically the computer, video and online games/interactive entertainment space. TIGA and UKIE have been lobbying for this actively since the previous scheme was cancelled on the 22nd of June 2010. Ian Livingstone (Eidos) and Josh Berger (Warner Bros) were at the meeting with the Chancellor a couple of Monday's back, these meetings are not held every day. I spoke to both before and after and it was a very positive meeting. This has to be a sign that this Government may be recognising that the UK has something to offer in the area of digital entertainment. Tax breaks have worked for film - just ask the US film companies who have invested in studios and production in the UK. They can work as an incentive in our industry. Most importantly, it would be a sign that the UK was 'open for business' in this space, which must be positive. Then as others say, we need Government, industry (via trade bodies TIGA and UKIE) supported by the media to aggressively market the UK. As I have said on more than one occasion to various politicians and ministers - 'if you want people to create and win you need to give them a flag to rally under'. Free market vs state support is not the ideology here. We should pick winners (as in industries) and make sure that those have the best chance in a free market. 23rd of March is the day when it will become public, in which we can get on and work out the rules of engagement, or not. If nothing happens in this budget for our industry, then we have to draw our own conclusions and make our own decisions as to whether the UK is a great place to do business in this space, or not. It really is that simple.

Posted:3 years ago

#12

Jason Kee
Director, Policy & Legal Affairs

1 0 0.0
@Fran said "One other thing - the Canadian provinces seem VERY good at actively going out to attract investment. ... We could definitely take a leaf out of some of their books when it comes to aggressively trying to take business from other territories."

In fairness, I can tell you that UK Trade & Investment is VERY active in Canada... I don't think I've been to an industry event in Canada over the past few years that did not have their branding on it.

Posted:3 years ago

#13
The fact that it's now being discussed is good news. I do think this Government is trying to understand and do what is right for business, it is certainly doing that with the professional services industry of which I and my firm is a part. Watch out for Kingston Smith's budget commentary in March where we will tell you about the impact for the tech and media sector, including of course gaming.

Posted:3 years ago

#14
its bout time we rebrand ourselves as the Entertainment industry to be inclusive of games, Movies and Animation for an inclusive richer whole (and thus allow for a stronger discussion with the government)

Posted:3 years ago

#15

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