Trade body Tiga has predicted that the UK development sector will decline by 25 per cent within five years unless tax breaks are introduced.
“The UK games industry is still successful and world leading. However, because most of our key competitors benefit from a tax break for games production, our industry is at a competitive disadvantage,” said Gareth Edmondson, vice chairman of Tiga and managing director of Ubisoft Reflections.
“Unless the UK Government introduces Tiga’s proposed games tax relief, our research suggests that employment in the development sector will fall by five per cent in each of the next five years, from 9,025 in 2009 to 7,351 in 2014. There would also be a fall of £1.9 million in development expenditure over the same period."
If tax breaks are introduced by the UK government, the industry will eventually enjoy annual growth of four per cent, according to Edmondson.
“With games tax relief enacted, the industry would stop shrinking in 2010, grow by two per cent in 2011 and by four per cent in each of the next three years. 3,550 graduate level jobs and £457 million of investments in the development sector would be created or protected with the advent of the tax break. Games tax relief would more than pay for itself. Over five years the tax measure would cost £192 million but would deliver £415 million in tax receipts.”
Gareth Edmondson will be speaking on behalf of Tiga at GameHorizon’s Best of British event tomorrow as part of this week’s London Games Festival.