UK gaming tax breaks 'four years away'

Answering questions in a select committee, creative industries minister suggests "a hiatus for three or four years" before development tax relief is back on the table.


The UK games industry has had tax breaks at the heart of its lobbying campaign for as long as it has had the resource and desire to lobby government. With the continuing "brain drain" to Canada thanks to that country's fiscal incentives, UK game-development trade body TIGA thought it had secured a major victory when the Labour government included targeted tax relief for video game development in its final budget. Unfortunately this was cancelled and labeled as "poorly targeted" by the incoming coalition government, and it now looks like the issue is going to be off the table for some time to come.

While Ed Vaizey, Minister for Culture, Communications and Creative Industries has previously indicated his support for targeted tax relief and spoken at high-profile events in support of the industry, he has now poured cold water on any hopes tax relief could be resurrected in the near future. Speaking in the Culture, Media and Sport select committee, he indicated it would be several years before the issue would be back on the table and that he encouraged TIGA to explore other options.

Tom Watson speaking at a recent games industry event.
Tom Watson speaking at a recent games industry event.

Longtime parliamentary gaming advocate Tom Watson raised the issue saying that "video games are the dominant art form of this century," and pointing out the UK industry had seen significant declines at a time of global growth. Watson highlighted recent figures from TIGA pointing out that in the past two years, UK developer headcount has dropped 9 percent, while in Canada the number of people working in game development has risen by 33 percent. He also suggested that the Canadian industry incentives may well break international competition regulations, though Vaizey indicated that this had been investigated by the previous government and that there "there wasn’t any mileage in that allegation."

Vaizey said that if the industry focused on tax relief in its lobbying efforts, that "could mean a hiatus for three or four years [or more] before it realistically comes back onto the table." In the same meeting, Vaizey did say that "there are other ways we can support [the games industry]," pointing to regional growth funds and raising the possibility of "direct support" from the Department for Business, Innovation and Skills. When asked if a tax break was completely off the agenda, he said he would "encourage TIGA in particular to look at other creative options."

GameSpot UK recently spoke to Tom Watson and John Whittingdale MP, cochairs of the all-party group on video games, as well as Richard Wilson, CEO of TIGA. For their views on the future of government support for the industry and the progress that has been made in the past year in increasing the prominence and awareness of the industry in parliament, check out the video.

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Avatar image for steven141

Both parties handle the countries finances poorly. Labour seems to spend too much on everything and the conservatives don't spend on anything. At least we won't be in debt anyway.

Avatar image for Danny_1993

Sanguis Malus obviously didn't get into last nights question time

Avatar image for Sanguis_Malus

Tax, tax, tax...........the UK state is so greedy There are no incentives or breaks in the UK, small business crumbles under taxes and our talent goes abroad. Just look at the design & fashion industry's, many talented designers working for foreign brands & who can blame them. This country does not invest in creative talent, instead it rewards greed and corruption in the city and does not hold those responsible to account. Look at the bankers, big bonuses are back already & we are all paying for the stitch up that they left us in. VAT will be 20% from off Britain!

Avatar image for blakeney

Basiclly, they are saying that we should stop thinking about the tax break again now, so its an effective persueder when they need our votes to stay in...... If babys could vote, they would be doing the same spin with the "tellytubbys and juice for everyone" sceme... :P

Avatar image for zeniftan

I'll believe it when it physically happens. But I get the feeling that when 4 years comes to pass the government, as it always tends to do, will announce that they're post-poning any videogame industry tax breaks in the UK by another 4 years. Politicians lie through their teeth all the time.

Avatar image for majere613

The sad fact is that at the moment, there's very little money to go around. A direct tax break to the games industry would look very bad at the same time as scrapping the Ark Royal and increasing tuition fees (or, to be more accurate, rejigging the entire student loan/grant/fee system in a way that can be simplified down to 'increasing tuition fees' by SWSS headbangers, but I digress). I'd love to see it myself, since I'm training for a job in the industry at the moment, but it's not likely to happen without some amazing windfall like, for example, a meteorite made of pure platinum landing in the middle of Hyde Park.

Avatar image for jaymib

The government just cares about lining their pockets with tax payers money, they destory this country before thining about other people needs. The Gaming industry is one of the few exports this country has and the government just using it as door mat.

Avatar image for deactivated-57fce817a4cf5

Actually, scrap that. It goes back even further to previous government! (I forgot about the mine closures). Destroyed whole communities that did.

Avatar image for deactivated-57fce817a4cf5

This country is being suffocated by our government right now. I mean generally, not just based on this subject. The sooner they are out the better. UK industry in general hasn't been supported properly in a long time. Not since Thatcher sold our industries to the Chinese.

Avatar image for big-boss-91

the current government won't last 4 years at this rate, i won't panic yet

Avatar image for Stabby

Enough time to slip below nations that have yet to start developing games?

Avatar image for gbrading

Expected, but seriously... Four years away is hardly worth planning for. There will maybe be a new government and then they'll just change everything anyway. Then they'll delay them as well. :roll:

Avatar image for Avenger1324

3-4 years before it is even going to be worth discussing So that's a no from the current government. But don't go assuming Labour would be in favour of doing it either - they had 12 years to introduce something like this and did nothing. To say they had it in their final budget is meaningless as they knew they weren't going to be around to hold that promise.

Avatar image for lister82

Their only for games because it makes them a lot of money. What about alcohol and ciggarettes? there many "chinks" in their armor for why they are still legal, and that is just because they get a huge amount of tax money from it. An example of the only exception to this is Weed, still being illegal and their reasons behind it is still all lies, I just love British goverment.

Avatar image for obywan

It's a shame and it's another proof that the current thatcherian government only cares about cutting costs and building up money in the short term; anyone could realise that in the long term under these condition the UK videogames industry would just suffer, but clearly they care about other things.

Avatar image for brendanhunt1

"UK gaming tax breaks four years away" Yea, next election. :roll:

Avatar image for liam82517

We would still have a labour government had brown done the right thing and stepped down. Thanks to his inflated ego we now have to suffer "thatchers children". Wont be long till the riots start back up over policy changes. Watching cameron swan around like hes the 2nd coming makes me sick, I hope all the game devs do move to canada just so they dont get their pants pulled down by money hungry eton boys!

Avatar image for buft

Im guessing that means you need to vote to keep the current government in power, when in fact it was the previous government who created this policy and the new prime minister and his cronies went and did away with it. forget about this under the white collar leadership, they dont really believe video game are real business.

Avatar image for SPBoss

Our new elected government is a business government, not a people government, they care more about profits and making money over th quality of peoples lifes. That is why I always thought labour was better.. current times are proving labour is better

Avatar image for Kid2812

Wish Brown won

Avatar image for SicklySunStorm

@ewen2 LMAO :D

Avatar image for ewen2

Think we need to look at keeping the talent in this country any way we can. @DJ_BROLY if you actually look you'll see labour closed more mines (hate bring politics here) @sicklysunstorm not all Scots hate the English my wife's English, but that just means I'm allowed to hate ;)

Avatar image for fenwickhotmail

They'll always be 4 years away..

Avatar image for penpusher

Figures that the MP's of Britian would just ignore the gaming industry, brushing it off as insignificant ... @DJ_BROLY considering those mines were dying on their feet and kept afloat by public money... anyway what does any of that have to do with this?

Avatar image for GamerLegend10

@TheDreamSeeker haha im with you on that :)

Avatar image for hannify

@DJ_BROLY SCOTLAND is part of BRITAIN. I hope you mean England...

Avatar image for DJ_BROLY

tories caused us scots to shut down most of the ship building in fife also dont forget Margaret Thachter (cnt spell it lol) shut down most the industrial factorys and the mines.

Avatar image for SicklySunStorm

@delta3074 - when I use the term "us, the British", I mean as a collective... my own personal situation, I wouldn't say I was that far removed from yourself. I have had a credit card, but never more than a £600 limit, and never gone over either... I'm talking about the masses of the rest of the population that literally live on credit and beyond their means - they have contributed to a massive amount of the position we're in, and sadly you're right, at the moment, it's those of us at the lower end of the spectrum that are picking up most of the pieces. My parents are both disabled and cannot work and will be affected massively by the coming cuts, but even so, I'm under no illusion that it's purely the Tories planned cuts that are to blame... they're dealing with a necessary evil [arguably in the wrong way somewhat], but dealing with it nevertheless. @DJ_BROLY - what on earth are you on about!? Lack of jobs - check, you got us there, but then this is a theme in many European countries at the moment. Lack of fun(?) based on what...? What exactly measures that...? You said you live in Scotland, so why would you even be bothered of "starting a revolution" in England anyway. Oh and by the way, Scotland is part of Britain, like it or not. We all know Scots hate the English [way to keep a stupid pointless hundreds of years old war alive by the way] and that's all your comments are based upon. Lack of fun indeed... you say it like Scotland has no problems itself(!)

Avatar image for DJ_BROLY

ago* oops lol

Avatar image for fps_d0minat0r

if you voted him, i hope your happy you just shot yourself in the foot. gordon brown wasnt doing much but you dont have to do much anyway, thats the whole point in a free economy.

Avatar image for TheDreamSeeker

@GamerLegend10 Time for a revolution?... I think so!.

Avatar image for Paul2004

Typical but expected. After the massive budget blackhole Labour left behind they have been walking a very fine line between debt and street riots so they want as much cash saved as possible in the least noticable way but thats hard to do at the best of times. This is bad news for the industry here but it isnt a shocker, as long as ppl keep making good games then im happy no matter where its made :)

Avatar image for delta3074

@sicklysunstorm,speak for yourself, i have never had a credit card, never taken out a loan ,naver brought anything on HP and i have never been in debt,i have never lived a life on credit, the previous goverment got this country in to debt through spending money that actually saved our country from complete ruin, labours plan to bail out the banks is now on track to dleiver 30bn pounds into the goverments coffers this year alone, our defecit was not caused by labour or unremployed people like the goverment would ahve you believe it was caused by a worldwide recession due to bankers mismanagement of our finances and when the OBR took another look at alistair darlings budge they realised that the it would have worked and there would have been higher growth and less unemployment over the coming years, cuts are neccessary, but not this deep this fast, i myself am a low income worker who will lose part of my housing benefit when they atart recalculating it differently and i will lose more money when they allow LHA and coucils to charge 80% of market rate rents, my rent will go from 80 pounds a week to 200 a week, make work pay my backside, i am married with 6 children, i work really hard and have never been in debt but i am going to be punished for never getting into debt and working hard, punish the people that caused this, the bankers, not the poor.

Avatar image for SicklySunStorm

I agree with you to a point GamerLegend10, but remember that the current government are having to clear up a whole heap of mess left by the previous government too, caused by no-one else but ourselves, the British people... we've all been guilty of life on credit and have got so accustomed to it, when it finally bit us in the behind, it's all the harder to take steps back and accept the cuts. What Cameron has done is shameful in some ways though, I admit that - mainly because he went against his word in the many points of his campaign manifesto, and that's just plain wrong. You have to wonder whether or not he'd be in power if he'd been honest in the first place, and the answer is probably an easy "No"... Clegg and the Libs must feel very sheepish having shaken hands with him and the rest of the Blues... lets just hope that we do start to see a difference with these cuts in the next 3-4 years. If not, you can bet your last quid that the next government won't be Tories.

Avatar image for delta3074

they are trying to stall this bill long enough for people to forget about it, the condem goverment doesn't want to pay out for anything for this country but they are quite happy to increase foreign aid and give ireland 10bn to pay there way out of reccession, i love my country but the goverment makes me sick to my stomach.

Avatar image for GamerLegend10

i hate our current government, they are ruining everything. They are blindly cutting so many things and losing so many people jobs its just ridiculous. If they want to sort out the economy then they shouldn't be ruining the countries businesses, losing millions of peoples jobs and damaging just about everything we have. the county is being seriously damaged by these idiots, if it were not for them our country would end up being in a much better state, but things will only get worse the longer they stay in power.