Tiga calls Government to benchmark tax system

Tiga calls Government to benchmark tax system

By Ed Fear

April 3rd 2009 at 10:53AM

Developer organisation seeks better tracking of R&D credit effectiveness and comparison with other G-20 nations

Tiga has called on the Government to keep better track of exactly how its tax credits benefit UK development studios, and to then benchmark against those of the other G-20 nations.

The call comes after the Department for Culture, Media, and Sport admitted that it has no specific figures of how its financial assistance benefits the sectors under its control.

“If the Government is serious about supporting innovation in businesses then it must measure the effectiveness of tax incentives, such as the R&D tax credit, that are available to the video games industry in the UK compared to those of other countries," said Tiga CEO Richard Wilson.

"The UK tax system does not operate in a vacuum. Governments around the world are competing to establish favourable tax regimes in order to attract businesses to their jurisdictions and to promote economic growth. Unless the Government measures the impact of its tax measures in relation to those of other countries, it will be impossible to tell whether it is assisting particular economic sectors as well as it could do.

“The Government also needs to benchmark the effectiveness of the UK’s overall tax system in terms of, for example, promoting business growth, investment and job creation in comparison to those that operate in the G-20. Tiga’s research shows that 31 per cent of game developers believe that the domestic tax burden in the UK is holding back their businesses," he added.