TIGA and the cultural test

TIGA and the cultural test

By Rob Crossley

April 30th 2010 at 9:30AM

With games tax relief nearly secure, Richard Wilson explores the next steps

It’s tricky and indeed a little unfair to mention UK game tax breaks without citing TIGA. The key industry association has tirelessly campaigned for state support since developers began calling for it.

The group’s indefatigability had even at points even raised doubts when many – including Develop – questioned whether support for the industry would be seriously discussed in the halls of Westminster.

In the wake of Chancellor Alistair Darling reserving £90 million for tax relief measures, we speak to TIGA CEO Richard Wilson about the next steps that need to be taken.

A few months back Develop questioned TIGA’s decision to fight on for game tax breaks. How wrong were we?
[Laughs] You weren’t wrong! That was the question you thought should be asked from speaking to the industry.
TIGA’s role is to represent its members as effectively as possible, and we know some people in the industry did become a bit… bored by the debate.

For TIGA tax breaks is the top priority. It is, and it was and it always will be the single most effective policy for the UK games industry. That’s why we’ve stepped up our guns.

If tax breaks are introduced, surely that would be TIGA's finest achievement since it formed?
Oh yeah, if the UK gets tax breaks it will be the greatest achievement that TIGA has pulled off for the industry. But it’s important to emphasise that, while tax breaks would be a great achievement, ultimately TIGA’s here to serve its members.

We have other ambitions, and there are more issues we’d ike to tackle.

We’re fast approaching an election. Which of the three parties gets TIGA’s vote, in regards to the policies outlined in your own manifesto?
Well, we are pleased that the [Labour] Government is planning to introduce game tax breaks.

Of course, The Lib Dems are supportive of games tax relief. They’ve made that quite unequivocal to us, and I’m sure the Conservatives will be pleased by what’s happened.

There are things in our manifesto that all the parties will support, and it’s my duty to ensure TIGA’s top priority is delivered.

There are of course questions surrounding the ‘cultural tests’ that decide whether a game qualifies, or not, for tax breaks. 
It’s going to be quite easy to qualify for this. Studios won’t have to base a game on double-decker busses, or anything like that, to qualify. There’s a wide criteria for the cultural test, and it’s a points system, which a lot of games would pass for.

Studios get points for senior staff being British and working in the UK. Also, you get points for games reflecting European or UK cultural heritage.

So, in regards to cultural British heritage – if the game was based on a UK sport, or film, or myth or historical events – a studio would get points for tax relief.

You will also get points for being innovative, or using new technology, or even being creative.

If your game is an original as opposed to being a sequel, you’ll get points.

When we and the Treasury undertook a test for this, we randomly picked out a number of games and found that 44 per cent qualified for tax breaks under this cultural test. What’s encouraging about that, of course, is that none of those games were built specifically to qualify for tax relief.

To give us a better idea of what works, which games did you submit?
We can’t say which ones, because they were submitted anonymously. But I can tell you that they were a random sample.

Once tax relief is up and running – assuming that it will be – TIGA will be handing out a lot of info and touring studios to explain how studios can qualify.

Okay – was it a random sample of games developed in the UK?
Yes.

You understand the culture test better than most. Say, for instance, a game like GTA IV was developed solely at Rockstar North – do yiou think it would qualify for tax breaks?
Oh, well I can only speculate, but from what I know – I think there’s a very good chance of that passing.

Okay, picking another one from random, if FIFA 10 was solely developed in the UK.
I’d think it’d have a good chance, absolutely.

The reason why I’m asking is because a lot of developers have told us they’re worried they’d have to change a lot of content and methods to qualify for tax breaks.
People should be confident about the tests. And we’re in a consultation stage, and we want to make entirely sure that the UK industry’s interests are best represented.

Finally, congratulations on all you’ve achieved to get tax breaks on the political agenda.
Thanks very much, very kind.