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.