Tiga calls on Scottish Parliament to back a tax break for games development

Immediate release

March 18th 2009

Tiga, the UK trade association for game developers, today called on Members of the Scottish Parliament to support a tax break for games development. Tiga made the call in advance of today’s debate in the Scottish Parliament about the Scottish games development sector.

Richard Wilson, CEO of Tiga, said:

“The game development sector is one of the pearls of the Scottish economy. Scotland has some excellent games developers, including Realtime Worlds, Denki, Dynamo Games and Tag Games in Dundee, Firebrand Games in Glasgow and Rockstar North and Outerlight in Edinburgh. The Scottish games industry also provides a model of industry-academia collaboration. Abertay University at Dundee provides some of the finest higher education games courses in the world and has excellent links with games development businesses.

“Yet Scottish game developers are competing on an uneven playing field. Our principal competitors in Australia, Canada, China, France, South Korea, Singapore and the USA all receive national or regional/state tax breaks for games production. No tax breaks for games production exist in the UK.

“If we want the Scottish games industry in particular and the UK games industry in general to stay ahead of the pack then we must introduce a tax break for games production similar to the European Union approved French tax credit. Industry research indicates that if a 20% production tax credit was introduced, investment would increase by£220 million over five years, generating a further 1,600 graduate jobs over the same period. This tax break would cost HM Treasury£150 million over five years.

“A tax break for game production would enable the UK games development sector to remain one of the top five countries for games development in the world. It would also safeguard the games industry’s substantial contribution to the economy, which in 2008 represented£1 billion in Gross Domestic Product,£419 million in tax revenues to HM Treasury and 28,000 jobs (10,000 in games development). Conversely, if a tax break for games production is not introduced, the resulting decline in economic activity in the games development sector is anticipated to lead to a fall of£145 million to HM Treasury revenues in 2013 alone.

“Video game development is an industry of the future. It is export oriented, research intensive, inherently creative and the UK is a world leader. Now is the time for the Scottish Parliament to send a powerful message to the Chancellor ahead of the Budget on April 22nd: claim this future industry for the UK by investing in a tax break for games development.”

ENDS

Notes to editors

1. Tiga is the national trade association that represents games developers in the UK and in Europe. We have 150 members, the majority of whom are either independent games developers or in-house publisher owned developers. We also have outsourcing companies, technology businesses and university departments that are members.

2. Tiga’s vision is to make the UK the best place in the world to do games business. We focus on three sets of activities: political representation, generating media coverage and developing services that enhance the competitiveness of our members. This means that Tiga members are effectively represented in the corridors of power, their voice is heard in the media and they receive benefits that make a material difference to their businesses, including a reduction in costs and improved commercial opportunities.

3. For further information about the economic importance of the games industry, see The Economic Contribution of the UK Games Development Industry (Oxford Economics, October 2008).

4. For information about the impact of a tax break for games production, see Gibson, R., (2008), Games up? The economic case for introducing tax breaks for the video games development industry– a summary

5. Nesta has recently supported the case for Government intervention to enhance the video games industry. See Meadway, J. and Mateos-Garcia, J., Demanding Growth: Why the UK needs a recovery plan based on growth and innovation (Nesta, March 2009), available at http://www.nesta.org.uk/assets/Uploads/pdf/Research-Report/demanding_growth_report_NESTA.pdf

6. For further information about Tiga, please contact: Dr Richard Wilson, Tiga CEO on:

Email: richard.wilson@tiga.org

Web: www.tiga.org

Mobile: 07875 939643

7. The debate in the Scottish Parliament will take place on Wednesday 18th March 2009 at 5 p.m.


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