Final pre-budget report before the election makes no reference to the struggling UK game development sector

UK Govt snubs game tax breaks

The UK government has again rejected calls for tax breaks in the game development sector.

Making what was clearly a coarse pre-budget speech for tough times, Chancellor Alistair Darling declared that his budget is one that would "secure the [economy ‘s] recovery and promote long-term growth."

But Darling’s pre-budget speech – his last before a general election – said that calls for game tax breaks were unconvincing.

The refusal of any tax subsidies comes in the wake of nearly two successive years of heavy campaigning from the UK game industry, spearheaded by games industry association Tiga.

The British sector is currently facing mass staff emigration to more developer-friendly nations such as Canada, which itself offers tax subsidies as big a 40 per cent of development costs.


The news may not come as a surprise to some observers. Late in October the Shadow culture secretary Ed Vaizey sidestepped a definitive commitment to game development tax breaks, thus easing pressure on the Labour cabinet to take action.

Speaking at the London Games Conference, Shadow Culture Minister Ed Vaizey told a packed room that the Tory party will “shape the future” of the game industry if elected next Spring, while at the same time slamming Brown’s Government of inaction on the matter.

And yet – with numerous game industry luminaries listening in on Vaizey’s podium speech – the Shadow Culture Minister deftly slipped any concrete vow to introduce the kind of tax breaks that the industry has demanded for over two years.

“I know most of you have been focused on an industry-specific tax break,” he said, “but I encourage the sector to think more widely than that.”

Days later, Labour Lord Puttnam – a longstanding advocate of the game industry – said that tax break reform is not the priority for the UK industry.


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