UK games industry

TIGA, the trade association representing the UK games industry, today outlined its three priorities for the next Parliament with the launch of its manifesto The UK video games industry: an agenda for the next Parliament. TIGA believes that the most pressing issues are: the introduction of Games Tax Relief as soon as possible; the retention and expansion of the SME R&D tax credit scheme; and a reduction in tuition fees for students studying mathematics and computer science degrees in order to tackle the skills shortage facing the industry.

The manifesto also advocates greater collaboration between the video games industry and educators, via industrial secondments, knowledge transfer and the promotion of video games in schools to encourage the study of math and science. The manifesto also recommends that the Government should work more closely with trade organisations such as TIGA when devising policy that affects the video games industry.

The manifesto firmly states that there is currently “no case” for creating a new UK video games council or extending the remit of the existing Film Council to cover video games.

In total the manifesto contains 30 policies for Government covering fiscal and monetary policy, regulation, piracy, classification (PEGI), education and training proposals.

Richard Wilson TIGA CEO states: “TIGA’s vision is to make the UK the best place in the world to do games business. TIGA’s manifesto for the next Parliament sets out a strategy to help realize this vision, providing the next Parliament with a concrete set of policies that will support the video games industry and foster its long-term continued growth. TIGA’s proposals address the key challenges our industry faces – from skill shortages and the lack of appropriately qualified graduates, through to specific tax, fiscal and monetary policies, encouraging investment in new IP, research and development, workforce development, education, business support, combating piracy and the UK classification system.

“We hope to work closely with the next Government and all Parliamentarians on these policies and we will continue to campaign hard to promote the agenda of the UK video games industry.”

John Whittingdale OBE MP, Chairman of the House of Commons Select Committee for Culture, Media and Sport; Vice-Chairman of the All Party Parliamentary Group for the Computer and Video Games Industry who provides a foreword for the manifesto states: “TIGA has consistently drawn attention to the increasingly uneven global playing field, with some Governments (notably in Canada) providing huge fiscal incentives and tax breaks to encourage gaming companies to relocate. We simply cannot afford to lose our industry overseas and so I very much support TIGA's call for Game Tax Relief, the retention of the Small Firms R&D tax credit scheme, and a general lowering of the tax burden on UK businesses as a whole. Games businesses, like any other businesses, need a low tax environment if they are to compete successfully.”

Jason Kingsley, Chairman of TIGA and Creative Director at Rebellion Studios also provides a foreword for the Manifesto, in which he states: “The video games industry is an industry of the future and the men and women who work in our industry are among the most highly educated, creative and talented people in the country. We seek your [Government] support to help our industry to grow.”

To read the TIGA manifesto in full please visit www.tiga.org or contact Richard Wilson, TIGA CEO on richard.wilson@tiga.org.

TIGA Manifesto Executive Summary:

TIGA makes policy proposals in 30 areas in this report. We have three key priorities:

1. The introduction of Games Tax Relief as soon as possible;

2. The retention and expansion of the SME R&D tax credit scheme; and

3. A reduction in tuition fees for students studying mathematics and computer science degrees.

TIGA’s policy agenda:

1. There should be no increase in the tax burden on UK businesses in general and on the video games industry in particular.

2. The Chancellor and the Bank of England should aim to keep base rates comparatively low, while aiming to hit the inflation target of 2 per cent on the Consumer Prices Index. A relatively loose monetary policy should help to reduce the cost of bank finance and other things being equal keep sterling relatively competitive.

3. Games Tax Relief should be introduced at the earliest opportunity.

4. Corporation tax rates should ideally be cut by at least one per cent during the next Parliament. Failing this, the rates should be frozen.

5. The planned increases in Employers’ National Insurance Contributions (NICs) should be abandoned. NICs should ideally be cut by one per cent during the next Parliament.

6. The rate of relief under the SME R&D tax credit scheme should be increased from 175 per cent of qualifying expenditure to 200 per cent. Engineers and scientists should be recruited into HMRC specialist R&D Tax Credit evaluation units.

7. The provisions that exclude some Intellectual Property (IP) businesses from attracting tax efficient investment under the Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) scheme should be removed.

8. The value of corporation tax losses (whereby companies can ‘carry-back’ corporation tax losses against profits of the previous year) should be increased to help small companies.

9. The basic income tax rate of 20 per cent and the higher rate of 40 per cent should be retained. Thresholds should be linked to inflation to avoid the effect of fiscal drag. The 50 per cent rate should be abolished.

10. The introduction of the patent box regime, for 10 per cent corporation tax on royalty income from patents, should be introduced in April 2012, rather than 2013.

11. The introduction of a pilot SME Training Tax Relief (TTR) should be considered. This tax measure would operate in a similar way to the existing R&D tax credits. SMEs would be able to offset expenditure on training, Continuous Professional Development (CPD) for staff and education outreach activities against corporation tax

12. The supply of good quality mathematics and science teachers in schools should be increased through incentives such as bursaries, ‘golden hellos’ and writing off of student loans.

13. Schools should be given the freedom and resources to teach alternative academic qualifications to GCSEs and A Levels that are acceptable entry qualifications for universities.

14. Schools should have greater flexibility over pay to enable them to attract good teachers and to ease shortages.

15. The video games industry should be promoted as a career option at school to encourage the study of science and mathematics subjects.

16. Expenditure on higher education should be increased to ensure that UK universities remain internationally competitive and can provide world beating tertiary education.

17. Tuition fees for students studying mathematics and computer science degrees should be reduced or kept competitively priced.

18. Industrial secondments between universities and games businesses should be promoted.

19. University research funding for curiosity driven research should be protected and ideally increased.

20. Train to Gain should be made even more flexible and used to fund a greater variety of courses at all levels.

21. The funding gap between FE colleges and schools should be eliminated as soon as practically possible.

22. Skillset, the Sector Skills Council for Creative Media, should promote STEM subjects and art and animation courses at school, and support those working in the games industry to undertake higher level training.

23. Knowledge transfer between universities and games businesses should be encouraged.

24. More financial support for video games should be delivered through national programmes. Existing Regional Development Agency funding for video games is irrational and inequitable.

25. Accredited trade organisations like TIGA should be able to use UK Trade & Investment (UKT&I) grants to cover travel and accommodation costs as well exhibition expenses.

26. Maintain a relatively lightly regulated labour market in order to enable UK games businesses to operate as flexibly as possible.

27. To tackle piracy, IP owners should be encouraged to adopt new technological solutions and business models. The most egregious serial pirates should be prosecuted.

28. The Pan-European Games Information (PEGI) age ratings system should be made compulsory for all boxed games designed for those aged 12 or above.

29. Government ministers in Whitehall and in Edinburgh and politicians in Westminster and Holyrood should engage with trade associations such as TIGA when devising policy. TIGA is a voluntary organisation that genuinely represents the video games sector.

30. There is no case for creating either a new UK Video Games Council or for extending the remit of the existing Film Council to embrace the video games sector. Government departments in Whitehall should continue the existing process of holding regular meetings with industry trade associations.

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