back to article '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 …

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WTF?

What?

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.

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my money is on....

EA.

what a shower of shjts they are. its a pity they hold the monopoly on football, and they make some half decent games. always released in beta tho. the last 2 ea games i got were both needing of day1 patches for something

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WTF?

Eh?

EA have significant development resources in the UK, so what possible reason would they have to object to some free money?

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FAIL

You're a few years out of date..

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.

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my money is on...

no-one. I suspect this is all a figment of someone's overactive imagination (or some magazine's PR department). Probably just one of may schemes scrapped by the tories on the basis that anything the previous govt. agreed to has to be wrong.

Jolyon

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I call BS

"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.

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Grenade

Unfair...

It would be unfair for computer games developers to get tax breaks... I mean why should they? I work for a programming firm and we don't get tax breaks, why should you get them simply because you code games? It seemed a bit silly and reactionary in the first place!

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Because

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.

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Saving

"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.

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'xactly so

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"

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Too right...

£190Million there, another £190Million there, and pretty soon you're talking real money. This "ah well, it's only another few quid on top of the giant stonking debt heap, what does it matter" attitude is what got the country buggered in the first place.

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So...

If the UK games industry was going to be given a tax break, does that mean that the cost to the buyer would be reduced as well? I doubt it. I agree, that £190m has to come from somewhere, and all these 'small' amounts do keep ading up...

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Anonymous Coward

And the Cost ?

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?

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Re : Savings ( or maybe not)

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)

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FAIL

Government should get out of the way

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.

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Unhappy

its economic warfare and you just surrendered

>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?

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They are mistaken

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.

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So what about every other industry that could leave the UK if its not given an TAX break!

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.

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Alien

Highly unlikely

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.

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Anonymous Coward

Subsidise the very rich futher....

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.

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eh?

you need to look at game devs wages. they arent anywhere that high. plus many have to do 12 hours days near project end, that can last for months.

so, adding an import duty means WE pay extra for the game. <facepalm>

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Anonymous Coward

re: eh?

You mean just like the vast majority of software developers, not everyone works for the likes of EDS and others who get vast HMG contracts and never deliver anything.

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Tax-breaks for industry

Difficult choice - subsidise industries that help us compete, or those that make us feel 'proud'? Defence or games? Oh wait, the games companies are in London. Probably tattooed Labour voting gay commie drug addicts. Defence it is then.

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