The European Commission has approved a €20 million Irish scheme under EU State aid rules to support the development of cultural digital games.
The measure will be open to digital games development companies liable for taxation in Ireland. Under the scheme, the support will take the form of tax credit up to €8 million per beneficiary. The maximum amount of the tax credit will be equal to 32% of the eligible costs, that is (i) the expenditure incurred on the development of a digital game spent in the European Economic Area, (ii) 80% of total expenditure incurred on the development of a digital game, or (iii) €25 million, whichever the lowest.
The scheme will run until 31 December 2025.
Dr Richard Wilson OBE, TIGA CEO, said:
“Video Games Tax Relief is the most important factor in determining the favourability of the UK’s tax environment as far as the video games sector is concerned. VGTR has been crucial in enabling the UK video games industry to compete on a more level playing field against the UK’s international competitors, particularly Canada, which benefits from generous forms of tax relief.
“In light of Ireland’s incoming 32 per cent rate of relief, TIGA is calling for an increase in the rate of VGTR from 25 to 32 per cent. As more countries develop similar policies to support the video games industry, now is the perfect time for the UK Government to commit to increasing the rate of VGTR to ensure our tax regime stays competitive and to boost economic growth.”