UK Games Industry Will Decline 5% A Year Without Government Tax Relief

The Independent Games Developers Association (TIGA) has renewed its call for the Government to offer a Games Tax Relief for developers in the UK. TIGA’s research shows the UK game industry will shrink by five percent a year for the next five years without a tax break, but would eventually grow by four percent a year if it were introduced.

With other countries such as Canada and France already offering tax breaks game makers in the UK are at a severe economic disadvantage and are feeling the pain of recession. Between July 2008 and July 2009 15% of UK development studios went out of business. Unless the Government intervenes, TIGA says nearly 2,000 more UK development jobs could be lost by 2014.

TIGA’s proposed Games Tax Relief would turn the situation round however. The industry would stop shrinking by next year, then grow by two percent in 2011 and four percent in the three years after. At the same time, the tax break would create 3,550 graduate level jobs and £457 million of investment.

What’s more, TIGA claim their Games Tax Relief would be a net benefit for the UK taxpayer. Over a five year period it would cost the Government £192 million, but return £415 million in tax receipts. It seems like a win-win situation, and Gareth Edmondson, Vice-Chairman of TIGA, set out the decision faced by the Government:

The UK Government has a clear choice: invest in an inherently successful industry to perpetuate our leading position in the world, or preside over the decline of a key knowledge industry.

Developers in the UK are behind some of the most successful and innovative titles in the industry, such as Grand Theft Auto, Little Big Planet and Fable. The Government already happily support UK film-making, so isn’t it time games got the same kind of deal?

Source: TIGA