Prime Minister endorses 20 per cent production cost tax credit as pressure mounts on UK Government

French games production tax credit goes live

France’s tax credit for games developers has been endorsed by the country’s Prime Minister and will officially go into practice in a matter of days.

PM Francois Fillon revealed the news last week during a trip to Paris to see games studio Darkworks, Les Echos reports.

The tax break was long-negotiated by the French government (which approved them in 2006) and the European Commission, which made them legal in December last year.

Game studios get 20 per cent of their costs back, provided they make games with a ‘cultural’ dimension.

It’s estimated that over 9,000 work in development in the French video games industry – although the number could now go up with the tax credit in place. Infamously, the tax breaks in French-speaking Quebec, Canada have been accused of helping studios grow in Montreal by tempting developers away from France.

A variety of schemes are in place in France to make it a leader in the digital space – along with the tax breaks, the authorities are trying to make broadband accessible to everyone in the country by 2012.

The State’s role in the digital economy is to "be the least restrictive possible," said Fillon.

With the French tax break legally accepted by the EC and now in force in France, pressure will continue to pile on the British Government to follow suit.

Indeed, the existence of the tax break in France is a key piece of evidence cited by the Games Up campaign, a coalition of 15 studios backed by UK trade associations Tiga and Elspa, which is demanding more respect from the authorities and legislators.

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