TIGA: Cultural tax breaks would generate 1400 industry jobs

The implementation of cultural tax breaks for UK games production would create 1400 new jobs and trigger hundreds of millions of pounds in new investment by British studios, TIGA has proposed in a report it today submitted to the Department of Culture, Media and Sport.

The trade organisation argues that a Games Tax Relief would, by year five of its implementation, see the industry investing GBP 176 for every GBP 100 of investment by the government in tax breaks.

In addition, game studio investment would rise by GBP 146 million, direct and indirect tax revenues by GBP 133 million and GDP contribution by GBP 323 million.

Employment in the games development sector fell by four per cent between July 2008 and July 2009, states the report, and 15 per cent of its companies went out of business. Meanwhile the impact of a brain drain of experienced staff to subsidised studios overseas is beginning to be felt, while countries such as Canada, Germany, Japan and South Korea have increased the level of fiscal support lent to its indigenous games industries.

Tax relief, adapted from existing legislation for the UK film industry, applied in three rates to benefit both large and small studios could reverse this situation, says TIGA.

Games would need to pass a cultural test, scoring against criteria of European heritage and game locations, languages, innovation, narrative and location of development and key development staff - with 44 per cent of games expected to fit the required profile.

Richard Wilson, TIGA CEO commented: "The evidence presented today provides a robust argument for the introduction of a cultural tax break for games production, which will benefit both the UK games industry and also ultimately the wider economy, providing additional jobs, investment and UK tax revenues. We hope the Government will work to introduce TIGA's proposed Games Tax Relief at the earliest opportunity."

"For far too long the UK video games industry has been effectively 'taken for granted'" added Lord Puttnam of Queensgate, vice chairman of the All Party Parliamentary Group on the Computer and Video Games Industry.

"To ensure the continuing success of this pre-eminently creative sector, I can only urge the Government to support TIGA's case for the introduction of a form of Games Tax Relief, as set out in this report."

TIGA's evidence, contributed to by Kuju, Blitz and Rebellion, was submitted today to Sion Simon, MP and Minister for Creative Industries.