The UK Treasury has unveiled plans for corporation tax reliefs worth 25 per cent pertaining to the gaming industry. It also stipulated that video games will be added to the remit for the Skills Investment Fund.
"Following consultation on their design, the government will ensure that the reliefs are among the most generous in the world by offering a payable tax credit for all three reliefs worth 25 per cent of qualifying expenditure," read an official statement.
The new fiscal policy is set to come into effect on 13 April, 2013, with full details to be confirmed by 11 December, 2012.
As it stands now, the proposed act will afford qualified developers the ability to "choose between an additional deduction at a rate of 100 per cent of enhanceable expenditure or a payable tax credit at a rate of 25 per cent of qualifying losses surrendered".
Industry Trade bodies TIGA (The Independent Games Developers Association) and UKIE (the Association of UK Interactive Entertainment) have voiced support for the bill as they believe that it is a progressive step towards “sector parity with UK creative industries”.
“Tax breaks for games production will ensure that the UK remains a world leader in the high technology video games development industry,” said TIGA CEO, Dr Richard Wilson.
“Tax breaks for the creative industries will boost production in games development, animation and high end TV production. They will contribute to a re-balancing of the UK economy away from an over-reliance on public sector employment and financial services towards highly skilled, export focused industries,” he added.
The Government also promised further investment in the creative skills fund by matching industry contributions up to £6 million. The fund will be administered by the sector council, Creative Skillset, over the next two years which will cover TV and Film, with the gaming industries allocation of the £6 million yet to be determined.
“Today's announcement of additional skills funding is more positive news, and a welcome sign of the games industry being seen as having the potential to be a leading growth industry to help drive the digital economy of the UK in the 21st century," said vice chairman of UKIE, Ian Livingstone.
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