Games industry tax relief plans under consultation

The government has begun a consultation over its plans to introduce corporation tax breaks for the animation and video games industries in 2013.


The Department for Culture, Media and Sport (DCMS) is proposing a test to identify “culturally British” games and animation which would qualify for the break.


Producers of “high-end television” are also included in the scheme.


The idea is based on an existing system already in place for the film industry.


The DCMS says the definition of “high-end television” is still being finalised but is likely to include productions which cost upwards of £1m per hour to make.


By applying the test, points would be awarded to games and productions giving them a “cultural value” score.


Those qualifying would be eligible for tax breaks – under the film scheme productions with a budget of £20m or less can apply for a 25% rebate on any expenditure deemed eligible for tax relief.


The deadline for responses is 29 October.


“The government is committed to supporting these creative and dynamic sectors by introducing tax reliefs for these industries,” said Creative Industry Minister Ed Vaisey.


“The film tax relief has been a huge success and I encourage all those with a vested interest in the animation, high-end television and video games industries to take part in this exercise, and make sure your views are known.”


Chancellor George Osborne announced the plans for tax break in the March Budget, with a view to introducing it in April 2013.


At the time Richard Wilson, chief executive of video games industry trade body Tiga, said it was a “brilliant decision”.


In 2011 the government announced that the tax relief scheme for the film industry would be continued until 2015.


Eligible films must be released in the UK, with 25% of their production costs spent in the country.