25% UK Games Tax Relief Delayed
The UK game industry was set to enjoy tax breaks next month, which would offer 25% corporate tax relief to video game companies producing UK-based products. However, the tax break has been delayed until approval from the European Commission has been confirmed.
â€œWe are confident of the governmentâ€™s commitment to implementing the tax breaks as soon as possible,â€ said Jo Twist, the CEO of UK Interactive Entertainment (UKIE). â€œBut we hope that the delay will be a short one and shall now be doing everything we can, working with the UK government, the European Commission andÂ TIGA, to get the state aid approval that we need as soon as possible.â€
Dr Richard Wilson, the CEO of TIGA, who represent developers such asÂ RareÂ and gaming websites such asÂ MoneyGaming, amongst other areas of the Games Industry, said: â€œGames Tax Relief is vitally important because its introduction will enable the UK to compete on a level playing field against our overseas competitors who already have tax breaks. Games Tax Relief will also power investment and job creation and also address the market failure in the under-production of culturally British video games.â€
UK game developers who are awarded 16 points in a cultural test will eligible to receive the Games Tax Relief. Marks are awarded for British story lines, characters and a voice track recorded in the English language, as well as the storyboarding, programming and soundtrack and vocal recording processes taking place within the UK.
The tax relief, which will also apply to animation and television production studios, was expected to come into effect in April 2013. Despite the delay, Dr Richard Wilson has said that he has â€œbeen assured that the UK Government is committed to this reliefâ€. Let’s hope that Dr Wilson’s optimism proves to be true.