UK Games Industry Tax Breaks Denied

By Calum Peak 30.06.2010 11

UK Games Industry Tax Breaks Denied on Nintendo gaming news, videos and discussion

As Labour's last term in parliament drew to a close before the elections, they pledged to introduce tax breaks for the gaming industry after a two year struggle in its last budget. With consent and support by both the Liberal Democrats and the Conservative parties, it looked to shine a promising light on an overlooked industry.

However, since the election of the coalition government, they have set about scrapping many schemes; the tax break being one of them, in their first 'emergency' budget. These changes are also included within the new 2.5% increase in VAT and freezing public sector pay.

It sounds simple to get the country back on its feet, but there have been reports that this may not be all that happened behind the scenes. Apparently one of the biggest game companies in the world exerted pressure on the UK Government and Trade Associates to abandon plans for the UK tax breaks. Whilst many studios fought for the right, one publisher counterbalanced the bid by speaking to well-placed allies within the coalition. Its reasons for doing this was that the company felt that it would of given the UK an unfair advantage over other nations within the same industry.

What do you think to tax breaks for the gaming industry within the UK? And was the coalition's decision right despite the intervention of another major company?

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I actually think no entertainment industry should get tax breaks in any country.
I love gaming, and want the smaller developers to survive, but I don't see why its more deserving them 99% of everything else.
There's just more important things out there.

http://www.fanficmaker.com <-- Tells some truly terrible tales.
Last update; Mice,Plumbers,Animatronics and Airbenders. We also have the socials; Facebook & G+

meh. I buy all my games from Japan anyway.

Avoid Games Like the Plague, productivity++

Darkflame said:
I actually think no entertainment industry should get tax breaks in any country.
I love gaming, and want the smaller developers to survive, but I don't see why its more deserving them 99% of everything else.
There's just more important things out there.

Problem being that it's already started, so unless the UK follows suit it could be really disastrous over the next few years.

Well, I don't think the games industry should be spared when everyone else has to suffer, so this is a good thing.

knighty said:
Darkflame said:
I actually think no entertainment industry should get tax breaks in any country.
I love gaming, and want the smaller developers to survive, but I don't see why its more deserving them 99% of everything else.
There's just more important things out there.

Problem being that it's already started, so unless the UK follows suit it could be really disastrous over the next few years.

Yeah, I know.
Its a stupid viscous circle. You have to give them out because other country's do, and your not competitive if you don't.
I don't see it as disastrous as such, but it certainly makes economy's needlessly more complex and less logical then they should be.

http://www.fanficmaker.com <-- Tells some truly terrible tales.
Last update; Mice,Plumbers,Animatronics and Airbenders. We also have the socials; Facebook & G+

Martin_ said:
Well, I don't think the games industry should be spared when everyone else has to suffer, so this is a good thing.

The point is that a (relatively small to be honest) investment now will lead to big gains in the near future, and in this case, prevent the UK from losing a really successful industry.

This is a lot more difficult then it seems on the surface. On the one hand -- yes we're all in a recession dealing with difficult financial problems. You're getting your taxes raised, so why should business be spared?

But then, what if this tax increase forces the video game biz to downscale its work in the UK, and perhaps move elsewhere? Let's say Lionhead downsizes its studio, then Knighty and a lot of other people might be out of a job. And then if there are higher taxes on the business, that's less money they have to invest. Maybe that tax increase takes away an artist they would have hired to work on Milo.

Labour may very well have flipped the decision themselves had they won the election. With any UK government, until a pledge is sealed and completed, no one should get their hopes up. It's a shame but I don't think this is the end of the tax break. If the new government's plan to cut the deficit actually works then they may rethink their decision in a couple of years when the country's finances are in a better position.

This is a good decision. As Martin said, the games industry shouldn't be exempt while everyone else has to suffer, especially when it's such an expendable industry.

With regards to people losing their jobs, it's a price we should all be afraid of and have to pay due to the reckless lifestyles of people over the last 13 years. Yes, it may make the coalition look like hearless twats, but there is no other conceivable option. People cannot continue to live like they were.

On a personal note, I would have preferred to have seen Welfare slashed hugely before anything like this. A £450 p/w maximum benefit? What a joke! You can rent a fully-detatched 5 bedroom house in southern England for that price. That isn't helping the poor, that's just giving people stuff they don't deserve.

Rant over.

Ifrit XXII said:
Labour may very well have flipped the decision themselves had they won the election.

Although I don't know the specifics of Labour Tory stances on this policy, I'd say that Labour would be far less likely likely to chance their mind. Not because Labour are more trustworthy or anything, but simply because their general policy was about trying to stimulate the economy and stop the dreaded 'double dip', whereas this coalition is more focused on reducing the deficit by cutting anything they can.

Robsy said:
This is a good decision. As Martin said, the games industry shouldn't be exempt while everyone else has to suffer, especially when it's such an expendable industry.

With regards to people losing their jobs, it's a price we should all be afraid of and have to pay due to the reckless lifestyles of people over the last 13 years. Yes, it may make the coalition look like hearless twats, but there is no other conceivable option. People cannot continue to live like they were.

On a personal note, I would have preferred to have seen Welfare slashed hugely before anything like this. A ��£450 p/w maximum benefit? What a joke! You can rent a fully-detatched 5 bedroom house in southern England for that price. That isn't helping the poor, that's just giving people stuff they don't deserve.

Rant over.

The BBC site had a budget calculator. I took away 30% of welfare and raised almost the the �£72 billion needed.

Anyway, the way I see it, the budget fuck up we have can't be fixed overnight. It needs smart investments and smart cuts. Giving the games industry a bit of money so it can compete on the international scene (which it really REALLY doesn't right now) so that it can continue to bring in lots of money (which it does) is a smart investment. And the amount of money needed isn't that much. The games industry is relatively tiny. I think I read there are more professional football players than game developers. If a lot of those people move to Canada, surely that was a poor decision made considering how much money the games industry brings in? Cutting the ridiculous welfare amounts we have (Some homes were on �£104,000 a year) is a smart cut.

I should note, I agree there shouldn't be tax cuts for game devs, but because it's already happened elsewhere it just has to now.

( Edited 30.06.2010 18:58 by knighty )

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