Developers of video games that are deemed "culturally British" can claim tax relief on some of the production costs in the United Kingdom thanks to a new tax relief scheme that officially went into effect in the region yesterday.
Under the newly implemented plan, game developers and publishers can claim a tax credit of up to 25 percent on qualifying production costs associated with producing games that are certified by the BFI as culturally British.
"The government is acutely aware of the huge contribution that the creative industries make to the UK economy," said UK culture minister Ed Vaizey. "As part of our long term economic plan we are ensuring that the right conditions are in place to nurture industries like the video games sector, and these tax reliefs are pivotal in ensuring we can compete on a global stage… Our video games companies are already regarded as world leaders, and our ongoing support will ensure they continue to grow from strength to strength."
UK-based video games industry trade groups Ukie and TIGA applauded the launch of the new tax relief program - something both groups have long been fighting to get implemented.
"It has taken years of hard work and dedication by many people in the industry and government to create the most innovative, inclusive, and future proof games tax relief scheme in the world at a time when it is most needed," Dr Jo Twist, chief executive of Ukie, said. "We worked very closely with government to make sure this scheme benefits every type and size of developer, and that it recognizes the importance of post-release production in games."
"The tax relief will unleash the financial and creative potential of the UK’s game businesses, benefit studios of all shapes and sizes and boost the production of culturally British video games," Dr Richard Wilson, chief executive of TIGA, said. "TIGA’s own research indicates that over five years the tax relief will create and protect 10,300 direct and indirect jobs and create and protect approximately £450 million investment expenditure by UK studios."