Osborne reveals tax breaks for video games producers

Chancellor George Osborne was keen to stress the "financial responsibility" of this year's Budget, which also revealed financial aids to encourage the production of animation as a way to secure further investment and growth across the country's entertainment sector.

Osborne's disclosure about the tax breaks for the UK games industry comes on the same day that high-street gaming store Game announced it was going into administration.

In a tongue-in-cheek comment, Osborne said: "It is the determined policy of this Government to keep Wallace & Gromit exactly where they are."

(Labour leader Ed Miliband is supposed to look like the Wallace character in the animated series.)

Wallace & Gromit is made by Aardman Animations, which has campaigned for tax incentives for the production of animation in this country from the Government .

Specific details of the tax breaks for the gaming industry – and the animation sector – have yet to be revealed but have already been welcomed by the games trade body, TIGA.

Dr Richard Wilson, chief executive of TIGA, said: "Tax relief for the video games sector will increase employment, innovation and investment in the UK video games industry. Our research shows that Games Tax Relief should generate and safeguard 4,661 direct and indirect jobs.

"It will also help to rebalance the UK economy away from an over-reliance on financial services towards a high-skill, R&D incentive and export-focused industry."

The gaming industry has long campaigned for improved financial inducements.

Brian Murphy, tax partner at accountancy firm Pricewaterhousecoopers (PwC), said: "It looks like it's now game on with the Chancellor announcing tax breaks will extend to games – and some TV production comes back into the tax relief net too."

Follow John Reynolds on Twitter @johnreynolds10

This article was first published on marketingmagazine.co.uk