'Industry giant' fragged UK games developer tax break Why did the Liberal Conservatives can a plan to give UK games developers tax breaks? Because "one of the biggest games companies in the world" persuaded them not to. So claims game creation website Develop, though it doesn't feel able to say which major developer leaned on the Treasury despite having "multiple, very trusted …
This isn't about unfair competitive advantage ... I don't buy that weak excuse for a second. So the publisher saying that is a two faced lier, not least because the publisher knows other countries have developer tax breaks.
Therefore what is really behind this?. After all, the tax break would have helped developers, but with the publisher taking this action, they are very evidently showing they doesn't want to help developers. So why I wonder? ... could it be that developers are very dependent on publishers for income financing, so any financial help to developers weakens the hold publishers have in negotiations with developers.
The publishers want to hold tight control over developers to keep exploiting them into the ground and this action shows they don't want to help developers.
EA isn't the villain of the piece any more- something of a change of personnel there, with a head guy who doesn't gnaw live human flesh.
No, Activision, helmed by grinning troll Bobby Kotick, who memorably promised that he'd take the fun out of gaming, for profit, is now more evil than EA ever were. Bullying their devs in a way that even Rockstar could only dream of, cranking out endless soulless sequels in a way that would make even the EA of old dizzy.
Seriously, Activision are probably the worst thing to happen to gaming ever. I'd bet your relatives and house pets that this one was Activision.
"Multiple trusted sources" may well reliably indicate that this developer leaned on the government to oppose the tax break.
That's not quite the same as saying the tax break was removed *because* of this pressure. There were other factors in play. Perhaps the pressure tipped the balance, perhaps the balance was already tipped.
It all smells of the narrative fallacy to me.
Presumably because it would have resulted in economic growth for the UK as a whole. The computer games industry (which is very big indeed) was largely pioneered in the UK and we've lost a lot of it to countries that offer tax breaks. Perhaps it would have helped the UK software engineering industry indirectly too - it doesn't seem that unlikely.
"The Treasury's own figures put the saving to be made from cancelling the planned tax break at £190m over the tax years 2011 to 2015 - not exactly a huge chunk out of the multi-billion pound national debt reduction plan"
It's still 190m quid that needs to be found somewhere. When you're skint, every penny counts.
Seen this so many times... its always possible to make an excellent case why Fred's pet project should be excluded from cuts - after all if it were not a good idea then one hopes it wouldn't have been proposed in the first place. But then you look at your savings and see "hey we treated everything as an exception so we haven't saved anything: we just spent a fortune talking about making savings"
What is the cost in lost jobs and economic growth ? Does 190 Million out way job retention and the income tax farmed from people employed in the Computer Games industry. Do you really believe after just 2 weeks this Government really has any clue about the knock on effects of any of their cuts?
Although cutting it could actually be a false economy :
"Moreover, the calculations on the tax relief plans demonstrated fairly clearly that they would actually leave the Treasury in the black within a short space of time, with tax relief for development being more than compensated for in revenues from the sales of the resulting products, not to mention the income tax earned from the large number of development staff employed in their creation. "
(Quote from a quite good sum up of why they got rid of the tax relief on gi.biz [http://www.gamesindustry.biz/articles/tiga-talks-tax-blog-entry - Free Registration might be required)
The LibCons were right to scrap this tax break.
If UK games companies aren't able to stand on their own, why should the rest of us subsidise them?
Taxes should be applied equally to all industries, but should be as low as possible. Corporation tax probably shouldn't exist at all. Stop sucking the life out of British companies, and let the market decide what we're best at.
Bureaucrats have no right to influence whether we build cars or software, or whether we write computer games or business software. This sort of interference benefits the politically connected few at the expense of the many.
>If UK games companies aren't able to stand on their own, why should the rest of us subsidise them?
Simple choice: do you want the youngsters that staff this industry pissing away their wages in Britain or somewhere else prepared to tempt them with tax breaks. Once those youngsters leave the UK they don't come back, don't send money back and my gaming £ ends up in the foreign pockets they work for.
If you want to fix this bit of economic warfare without offering tax breaks, good luck trying to close down the subsidies we're fighting against. But you don't really care do you?
They will not be making any savings what they mean by 190m is that its the total tax they will take from the computer game industry by not giving them a tax brake. Sadly tough what they fail to understand is that the computer game industry will eventually just leave the UK to go to countries who do offer tax brakes mean that in the long term they will get less tax.
Also the industry will not grow as who will want to start up or move to the UK when it is financial better to go else where.
And remember that a company with a tax brake still pays tax else where mainly though there employees(income tax) and other taxes, remember everything has added to the tax somewhere along the line. More business in the uk even tax free ones will benefit the country.
There is nothing special about computer games, one could easily argue that writing business software would help the economy far more.
The UK was a pioneer, but that was 20 years ago when the "BBC model B" and "Sinclair Spectrum" were king.
This is very unlikely, as Mandelson is no longer business secretary. He can't go swanning around doing clandestine deals with moguls on their private yachts any more.
More likely the government looked at all the bribe tax cuts Labour threw out during their dying days and realised we just can't afford to be refunding the entire tax bill of a games company if their game flops.
So all taxpayers have to subsidise these £50/70/90k developers. Nice.
They are already handsomely overpaid.
If Canada/South Korea/France are subsidising their developers, simple. Add an import duty to games developed in those countries so that games companies that benefit from this subsidy don't gain an advantage.
The Register 
Biting the hand that feeds IT
Copyright. All rights reserved © 1998–2025
