R&D tax credit to help Aussie devs
Australian government's proposed A$1.8 billion R&D tax credit legislation set to pass parliament after Greens support.
The Australian game development industry is set to gain from an improved tax credit legislation for small-to-medium businesses currently waiting to pass through Australian Federal Parliament.
The Greens announced this week they would support the A$1.8 billion ($1.89 billion) research and development tax credit following the federal government's agreement to some parts of the legislation. The new law will deliver a 45 percent refundable tax credit to businesses with a turnover of less than A$20 million, a bracket that many Australian game development studios fall into.
The Game Developers' Association of Australia (GDAA) welcomed the announcement today, saying it shows a strong commitment on the part of the federal government toward "the development of Australia's knowledge economy."
"Since the first announcement of the [research and development] tax reform and in our own discussions with the department, it became very clear that the government has confidence in the abilities of Australian SMEs to deliver ground-breaking innovations for the global market," GDAA chief executive Tony Reed said.
"Innovation is at the heart of game development and the introduction of the new legislation not only assists in levelling the global competitive playing field, but also affords the local industry the opportunity to challenge traditional gameplay conventions."
The new tax credit will start from next month and the federal government has agreed to introduce quarterly payments for business from 2014. According to the GDAA, the global computer and video game industry is currently worth $50 billion, expected to rise to $76 billion in 2013.
The Interactive Games and Entertainment Association (iGEA) also weighed in on the news, with CEO Ron Curry acknowledging the Australian research and development tax reform has attracted the interest of global publishers.
"The games industry is already a major contributor to the GDPs of a number of international territories and the introduction of the legislation could well put Australia on the same path. Once the legislation is passed through the senate, we should expect to see an increase in investment interest from publishers that have established development studios in Australia and potentially far greater investment in the intellectual properties being developed within local game development studios," he said.
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