MP renews call for Games Tax Relief
Parliament saw fresh calls for a dedicated Games Tax Relief for the UK videogame industry today after an MP urged culture minister Ed Vaizey to review the issue "as a matter of priority."
Jim McGovern, Labour MP for Dundee West, raised Games Tax Relief during parliament's Culture, Media and Sport questions yesterday, GamePolitics reports. In response, Vaizey said: "I discussed future government support for the creative industries – including the videogame sector – with the chancellor of the exchequer in the development plan for growth which was published alongside Budget 2011.
"The plan for growth sets out the specific actions that we are taking to tackle major barriers to growth in the creative industries and to create the right conditions for creative businesses to flourish."
Vaizey refers to the chancellor's budget, revealed in March, which saw UK R&D tax credits rise 200 per cent, and also contained measures aimed at helping all businesses grow, with corporation tax cut and small business regulation eased. McGovern, clearly feeling the existing measures do not go far enough to protect the UK videogame industry, pushed Vaizey further.
"I am sure the minister will appreciate that was not the [answer] I was looking for," he said in response. "He will be aware that games companies in the UK are closing and that many of their staff are going to Canada." Pointing to the Irish government's recent confirmation that it was exploring the possibility of tax relief for its videogame sector, he continued: "For some reason this government persists in doing nothing.
"Will the minister reassure me, the House and my constituents that the assessment of tax breaks for the industry, as recommended by the Scottish affairs committee, will be carried out as a matter of priority before more harm is done to this very important industry?"
Sadly, Vaizey remained typically non-committal in his response, saying: "I know that 150 jobs have been created in the industry in [McGovern's] Dundee constituency. Measures in the budget, such as the changes to the research and development tax credit and the enterprise investment scheme, will help the video games industry. I will continue with my vocal and, I hope, practical support for that important industry."
McGovern's stance is understandable, with his Dundee constituency one of the UK's few remaining development heartlands. While Realtime Worlds closed last year, many developers are still based there, and the city's Abertay University runs several highly respected game design courses and the annual Dare To Be Digital development contest.
TIGA, the UK trade association which has campaigned tirelessly for the government to introduce Games Tax Relief, said in a statement: "We urge the Government to carry out this review. The UK video games industry is not yet competing on a level playing field because many of our competitors have a tax credit for games production or other similar measures."
Games Tax Relief was introduced in March 2010 by Labour chancellor Alastair Darling, and publically supported by all three major parties in the run-up to last May's general election. Shortly after the conservative and liberal democrat parties formed a coalition and assumed power, chancellor George Osborne reneged on promises to introduce the relief, describing it as "poorly targeted."