European Commission expected to announce whether it will approve incentives 'in the very near future'
Games tax relief delays are greatly harmful to the UK game industry, states a report from the Culture and Sport Committee.
Tax breaks for UK developers were expected to go through in April earlier this year, but were postponed after the European Commission announced it would be investigating whether the UK really needed the incentives.
It questioned whether such a scheme was necessary in the absence of what it called “an obvious market failure”.
A new report from the Culture, Media and Sport Committee has ursed the Government says continued delays on the scheme is proving harmful to the UK industry, and urged the Government to make this point to the EC forcefully.
“We deeply regret the European Commission’s decision to investigate the validity of the proposed tax relief for video games. Introduction of the credit is long overdue, following its postponement by the Government after the election in 2010,” read a statement.
“There is clear evidence that such a tax credit would be of great benefit and delays in introducing it are greatly harmful to the industry. We urge the Government to make this point forcefully in its efforts to ensure the video games tax relief gets the go-ahead from the European Commission.”
There is a chance that tax relief for the games industry could be backdated. As a result of the Finance Act 2013, similar tax breaks for the animation and high-end TV sectors will be backdated to April 2013, when the games incentives were scheduled to be approved.
The European Commission announced it had concluded its consultation on games tax breaks on September 5th, and a decision is expected “in the very near future”.