Tiga's new target for tax breaks: Scottish Government

Tiga's new target for tax breaks: Scottish Government
Michael French

By Michael French

March 19th 2009 at 11:06AM

UK trade association calls on Scottish MPs to support a tax break for games development

Tiga has once again called for Government to support a tax break for games development, lobbying Scottish MPs to support such a plan.

The organisation has cited the large number of studios based in Scotland that would benefit from such an economic boost.

Richard Wilson, CEO of Tiga, commented: “The game development sector is one of the pearls of the Scottish economy. Scotland has some excellent games developers, including Realtime Worlds, Denki, Dynamo Games and Tag Games in Dundee, Firebrand Games in Glasgow and Rockstar North and Outerlight in Edinburgh. The Scottish games industry also provides a model of industry-academia collaboration. Abertay University at Dundee provides some of the finest higher education games courses in the world and has excellent links with games development businesses. 

“Yet Scottish game developers are competing on an uneven playing field. Our principal competitors in Australia, Canada, China, France, South Korea, Singapore and the USA all receive national or regional/state tax breaks for games production. No tax breaks for games production exist in the UK.

“If we want the Scottish games industry in particular and the UK games industry in general to stay ahead of the pack then we must introduce a tax break for games production similar to the European Union approved French tax credit. Industry research indicates that if a 20% production tax credit was introduced, investment would increase by £220 million over five years, generating a further 1,600 graduate jobs over the same period. This tax break would cost HM Treasury £150 million over five years.

“A tax break for game production would enable the UK games development sector to remain one of the top five countries for games development in the world. It would also safeguard the games industry’s substantial contribution to the economy, which in 2008 represented £1 billion in Gross Domestic Product, £419 million in tax revenues to HM Treasury and 28,000 jobs (10,000 in games development). Conversely, if a tax break for games production is not introduced, the resulting decline in economic activity in the games development sector is anticipated to lead to a fall of £145 million to HM Treasury revenues in 2013 alone.

“Video game development is an industry of the future. It is export oriented, research intensive, inherently creative and the UK is a world leader. Now is the time for the Scottish Parliament to send a powerful message to the Chancellor ahead of the Budget on April 22nd: claim this future industry for the UK by investing in a tax break for games development.”