Legal Research

Govt change position on videogame industry tax relief within space of 3 days

By scott

I know they say that a week is a long time in politics, but … on Monday the Government responded to House of Lords Select Committee on Communications report on the British film and television industries. In response to the Committee’s following recommendation on the video games industry:

We recognise the claims of the videogames industry for support in the face of foreign government-subsidised competition, and recommend that the Government consider providing tax incentives for videogames production.

The government response was:

“The 2009 Pre-Budget Report announced that, whilst recognising the challenges currently faced by the sector in competing internationally, the Government is not currently persuaded that the evidence is sufficiently compelling to justify the introduction of a tax incentive for the development of culturally British video games at this time. The Government remains committed to providing a tax system and business environment that is beneficial to businesses from all sectors, including the video games industry. The Government will continue to look at ways to make the UK tax system more competitive and, as with all decisions on tax policy, will keep the situation under review.”

Fast forward, oh, say, two days and the government, via Alistair Darling announce in their Budget speech the following: “I will offer help to the computer games sector, similar to the steps which are helping restore the fortunes of the British film industry. This is a highly successful and growing industry, with half its sales coming from exports, and we need to keep British talent in this country.”

In the actual text of the budget doc: “The creative industries, including the video games industry, make a valuable economic and cultural contribution to the UK. The Government announces that, following consultation on design, it will introduce a tax relief for the UK’s video games industry, subject to state aid approval from the European Commission.”

Anyone know what sufficiently compelling evidence came to their attention since they said ‘press print ‘on their response to the Lords’ report over the weekend and today when Mr Darling decided there obviously was enough to justify the introduction of a tax incentive??

Full post as published by Information Overload on March 24, 2010 (boomark / email).