When Chancellor George Osborne offered some tax breaks to the creative industries today, he seemed to forget a critical one for the UK – video games.
But looking through the ‘Red Book’, the full budget document, it seems there are some measures to help the industry contained within it. The budget says:
The government will extend video games tax relief to goods and services provided from within the European Economic Area and apply a cap on subcontracting of £1 million per game, subject to state aid clearance.
The legislation will also be clarified so that only those games and programmes qualifying for relief will be treated as separate trades.
Levelling up
Many in the industry have long pushed for state aid in the form of Games Tax Relief to bring them in line with other UK creative industries, and to allow UK developers to compete with the games industry around the world.
Today’s measure is a step towards helping UK games developers, altering some of the legislation that would bring in GTR if given European Union approval.
Rob Simmons, from Atomic Cartoons, wrote in Tech City News last week that Osborne’s tax credit for the animators that came into effect last year is a game changer for the industry – so could the same happen here?
Small steps
UKIE CEO Jo Twist says “the ongoing delay to the UK games tax relief scheme has been very frustrating for UK developers,” and her organisation described today’s news as a “small change”.
While others I have spoken to in the games industry are much more positive about today’s developments, they wait to see if they final deal can actually be secured.
The European Union still needs to approve Games Tax Relief for the UK, and the industry seems determined to keep the pressure on until GTR is fully secured.
The fact that the Chancellor didn’t announce this change shows he clearly doesn’t think the issue is settled just yet – despite today’s development.