Computer games industry dealt a blow in budget

Following the recent emergency budget the computer gaming industry has been dealt a real blow after finding out that there will be no tax breaks for the sector.

Following speculation last year over tax breaks for the computer gaming industry many industry officials were enthusiastic about the effects that these tax breaks would have on the sector, enabling great development to take place nationally rather than internationally and stopping developers going to other countries that offered greater incentives.

Many broadband users now enjoy online gaming thanks to the affordability of broadband services coupled with the higher speeds and download limits available, making the computer gaming industry a very lucrative one. However, in George Osborne’s recent emergency budget the computer taming industry was dealt a real blow after finding out that there would be no such tax break.

The tax relief on games was set to cost the government nearly £200 million over a four year period, and with the coalition government determined to make cutbacks in order to tackle the UK’s huge public deficit this was one of a number of areas that suffered. In his budget speech Osborne said: “We will not go ahead with the poorly-targeted tax relief for the video games industry. There will be a small reduction in the rates for capital allowances, which will remain broadly in line with economic depreciation.”

Richard Wilson, chief executive of Tiga, the industry association for games developers, said that the gaming industry felt betrayed by the decision by the new government, stating: “This is a complete betrayal of pre-election pledges given by both parties in the coalition.”

Source – FT