Government calls on industry for new evidence to support 'cultural' subsidy
The Government is listening: the UK's Department for Media, Culture and Sport has today put out a call to the games industry to provide evidence for a culturally based tax break for the UK development sector.
It comes after the Digital Britain Report, published two weeks ago, said that the Government should consider introducing subsidies that would help protect and encourage more games development business in the UK.
In a letter to the Tiga and ELSPA, the DCMS asked for evidence to demonstrate how the issues currently facing UK game developers can be resolved by the formation of a tax break incentive - specifically, one which has a cultural focus, like the tax break available to film production.
Writing to ELSPA director general Michael Rawlinson and Tiga CEO Richard Wilson, MP Sion Simon, the minister for the creative industries, said: "[Digital Britain] highlights the value of the games industry to the UK economy, the opportunities we would like the industry to be well-placed to grasp and the challenges it faces, including competition from rival games producing countries offering financial incentives not available in the UK. Our commitment to work with you, and others in the games industry, to gather evidence that may support a case for the introduction of culturally based tax breaks for computer games, was influenced by these previous discussions."
He added: "The evidence that we now need from you should demonstrate how the issues the industry currently face can be resolved by the formulation of an incentive with a specifically cultural focus.
Advertisement
"A cultural tax relief of this kind would be aimed at supporting games of significant cultural value to the UK ensuring that the cultural relevance of games is fully recognised. It would also ensure that UK games companies are supported for creating an identifiably British product using the skills and creative expertise of UK games industry workers."
The industry should move quickly, however, Simon added: "How far we can now take this proposal is dependent on the evidence the industry is able to produce to clearly demonstrate how and if this potential measure may work for the UK games sector. Although Government would like to move quickly to ascertain if a case for support can be made, the speed with which we can make progress is therefore reliant upon the quality and timeliness of evidence the industry can provide.
"I would encourage you to work together to produce the required information as, once you have gathered your evidence, we will be able to assess whether we can move on to the next stage and present the case to HM Treasury."
The letter also acknowledges the lobbying work the two have done when it comes to the tax break issue and topics like games classifications.
Both bodies welcomed the Government's call for evidence.
Call me a cynic, but from reading that is anyone else thinking that no matter what is handed in and when, they'll say "too little, too late"
Yeah I don't think they'll actually give it either - they'll proberbly turn around saying it will only benefit a few people or that.
What worried me was this passage:
"A cultural tax relief of this kind would be aimed at supporting games of significant cultural value to the UK ensuring that the cultural relevance of games is fully recognised. It would also ensure that UK games companies are supported for creating an identifiably British product using the skills and creative expertise of UK games industry workers."
Sounds like the government wants british games design companies to produce games with british accents, cups of tea and cucumber sandwiches? Sounds to me like they might agree to it but force the games to be overly british influenced if you know what I mean.
Rockstar maybe forced to update GTA London!
Several hundred words, when six would have sufficed:
"Tell us why you need it."
I have to admit, I do feel like ripping my hair out when I see stories on tax breaks now. It really does seem like it'll be a case of too little too late, if at all. The government is throwing TIGA, and the industry, crumbs from its table, and TIGA for one is very grateful and claims it's real progress. We were told last week that TIGA were making progress, now we're back to square one - tell us why you need it. And there's nothing to say the Tories would be any better.
To be fair to TIGA, it's definitely not a backward step. Problem is, it's not a forward one either.
I REALLY had to laugh at the comments the other week about how TIGA had been promised stuff in private, which they seemed to think made a difference. The ONLY difference between a public and private promise from politicians is that you can deny breaking a promise you gave in private. Naivety in the extreme.
Fran, please let me know what company in the games industry you work for as I would like to avoid working with them if your attitude is indicative of your general business practices. Seriously, just what is your problem? If this happens then it will be great for developers, if not, well then nothing will have changed for the worse.
Don't be too hard on TIGA, they have to justify their budget and show they take care of the people funding them!
In Europe, you should be able to apply for tax break on R&D. Perhaps TIGA should inform you on that before trying to get something else.
In France, they have a tax break. The rules to benefit from it are so specific that only one company can benefit from it (basically, if you take the games that can potentially benefit from it, you end up listing the few company that lobbied for it!).
You should also try to be as imaginative as French companies and lobby to have several funding similar to RIAM, FAEM, and even, the last fashion "poles de competences", a european stuff again (i'll pass on all "local" funds available).
@ Robert - eh? Because I happen to care enough to have an opinion on the matter? Quite frankly, if everyone took the view that the government is moving in the right direction then nothing would get done.
David, I haven't seen too much on the French tax breaks system. I'm married to a Quebecois, so have seen how the Quebec system works on the ground, in terms of how successful it has been at attracting studios and jobs over there. What was interesting was the NESTA report from several months ago:
http://www.nesta.org.uk/raise-the-game-report/" onclick="window.open ( this.href ); return false;" class="comment_url" >http://www.nesta.o...port/
It raised a couple of issues with the Canadian system, one of which was that it basically benefited mainly foreign companies and squeezed out indigenous developers (let's remember that it was initially introduced after a lot of lobbying by Ubi), then there's the question of profits and IP basically sent overseas. And what will happen when it becomes cheaper to move the work to the far east? Will the likes of Ubi threaten to do so unless the Quebec government provides further incentives? And, if that happens, will the Quebec government back down in the face of several thousand unemployed games developers in Montreal?
For EU reasons, the UK won't be able to match that system - and we probably couldn't afford it anyway.
Here's a question. There was an article in 3D World recently that basically said that, for the movie industry, London was one of the centres of the universe these days, and becoming much more important than LA. Given that there is a cross over with games, why is that the case for the movie industry but not the games industry? It can't be because of the film credits here, because on a "gross revenue per employee" basis, the games industry is still in better shape than the movie industry.
As for TIGA justifying themselves, I have no real issue with TIGA other than I think they're a bit too timid on this issue. But that's just me and I'm entitled to my opinion, right? ;)
