Impact of Games Tax Relief to be twice as big as expected
New research shows GTR boost for UK videogame industry will be twice that of previous estimates due to sector's recovery in 2012-13
TIGA, the network for game developers and digital publishers, today released new findings from its annual report into the state of the UK videogame industry Making Games in the UK Today: June 2014 which shows the impact of Games Tax Relief (GTR) on the sector will be even greater than previously forecast.
This is due to the industry returning to growth in 2013, with studio headcounts, wider games industry employment, tax revenues and investment all on the up, as revealed by TIGA last week. The findings show that whilst GTR protects existing jobs and investment, and thus prevents a return to decline, a larger, healthier industry also means an increase in the impact and return on investment from Games Tax Relief, as demonstrated by the figures below.
TIGA's previous estimates predicted that over five years GTR would:
- create and protect 4,661 direct and indirect jobs;
- encourage approximately £188 million additional investment expenditure by UK studios; and
- generate £172 million in new and protected tax receipts to HM Treasury at a cost of just £96 million.
Now, TIGA's new research indicates that over five years GTR will:
- create and protect 10,300 direct and indirect jobs;
- create and protect approximately £450 million investment expenditure by UK studios;
- generate £490 million in new and protected tax receipts to HM treasury at a cost of £129 million to HMRC.
When comparing the previous and current research this means GTR will now:
- create and protect over 5,639 (220%) more jobs than expected;
- increase and protect £262 million (239%) more investment than previously anticipated; and
- create and safeguard £318 million (285%) more tax revenue than expected, thus generating a 3.8 to 1 return on investment.
Additionally, TIGA has published an updated guide to GTR in partnership with Grant Thornton, which is free to download and can be accessed here www.tiga.org/join-tiga/online-subscribers. Also available is a video of TIGA's London GTR Q&A session, which can be seen here http://vimeo.com/92947324.
Dr. Richard Wilson, CEO, TIGA, comments:
"GTR will make an even bigger bang than expected. TIGA's new research shows that GTR will be good for jobs, good for investment and good for the UK economy. With the sector returning to growth, GTR's impact on employment, investment and contribution to GDP will be enhanced.
"TIGA wants as many games developers and digital publishers as possible to benefit from GTR. So today we are publishing a new guide with Grant Thornton that explains how studios can benefit from the Relief. We are also publishing a video of a recent TIGA 'GTR Q&A Session' which explains how games businesses can make the most of the advantages offered by GTR. We look forward to seeing studios benefit from GTR and develop more culturally British and successful games."
Jason Kingsley OBE, TIGA Chairman and CEO & Creative Director, Rebellion, added:
"These revised figures are welcome and important news for the UK games industry. Games Tax Relief is now set to lead to an upsurge in investment in the games industry, resulting in more jobs and more culturally British games being developed.
"This is great news for the UK games industry and for the wider economy. Now it is up to developers and digital publishers to demonstrate what these figures look like in action in the form of new games and new jobs and to drive our high technology and creative industry to new heights of achievement."