EGDF president rejects concerns that cultural tax breaks may have negative impact

Quantic Dream COO: Tax break fears â??rubbishâ??

The president of the European Game Developer Federation has brandished fears against game tax breaks as “fallacious” and “not serving the interest of the British and European games sector”.

Guillaume de Fondaumière – also the COO of Heavy Rain studio Quantic Dream – took issue with concerns Develop heard from publishers and trade bodies surrounding game tax breaks.

“Having recently released a game that benefited from tax breaks in various forms [Heavy Rain], I have yet to discover ‘new laws, revised tariffs’ that would have [been] imposed on me or my publisher,” he said in reference to the article.

“The arguments mentioned in your article are simply fallacious and do not serve the interest of the British and European games sector,” he added.

The news item itself is Develop’s first step to bring into public discussion the private fears surrounding games tax breaks in the UK.

Develop has been told from over ten trusted sources that at least one global publishing company had campaigned against game tax breaks in the UK.

The reasons why a company would oppose game tax breaks are complex, vague and potentially embarrassing for a publisher. Some of those fears, however bizarre they might seem, were expressed sincerely and thus outlined in the report.

Some of the concerns, such as cultural tax breaks resulting in the reclassification of games as audiovisual products, had already been partially addressed by the European Commission.

As cited in this document (pg 8, point 64) the European Commission ruled that games can be cultural and still be software.

And yet the ISFE told Develop today that it still is concerned that games would be classified audiovisual products if applied to a cultural tax test.

de Fondaumière concluded: “A number of countries or regions are "experiencing" incentives in the form of tax breaks (since decades for some now), using cultural exception status under WTO/EU laws, and it has yet to be proven that such incentives have had anything but extremely positive impact on both developers and publishers taking advantage of these.”

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