TIGA, the trade body that represents the UK games industry, has hailed plans unveiled in today's budget to enhance R&D tax credits as a "decisive victory" for its members.
According to a spokesman for the association, Chancellor George Osborne's proposals are worth around £7 million to the computer games industry.
Dr Richard Wilson, TIGA chief executive told the BBC: "The R&D tax credits will deliver 60 to 70 per cent more value to games studios than the current tax credit regime."
But Wilson said that he was disappointed that the government had delivered the specific tax relief the industry had requested.
"Failure to deliver TIGA's Games Tax Relief is a dismal decision that displays a complete lack of imagination and one which will leave the UK video games industry swimming against the tide internationally," said Wilson.
"Our key competitors have tax breaks for games production. The UK does not," he added.
While the R&D could mean new jobs for the industry, it looks set to do little to stem the tide of developers moving overseas to countries including Canada, where the tax regime is more favourable.
Canada's gaming industry grew by 33 per cent between 2008 and 2010, nudging Britain into fourth place in the world, with a decline of nine per cent in the same period.
Plans by the previous Labour government to introduce tax breaks for the games industry were scrapped in the incoming coalition government's 2010 emergency budget.
In December, culture minister Ed Vaizey told games industry chiefs they could expect no tax relief for the rest of the parliament.