TIGA, the network for games developers and digital publishers and the trade association representing the video games industry, welcomed the Government’s plans to enhance R&D tax credits but renewed its call for an increase in the rate of Video Games Tax Relief from 25 per cent to 32 per cent and the introduction of a Video Games Investment Fund. TIGA made the comments following the Chancellor of the Exchequer the Rt Hon Rishi Sunak’s delivery of today’s Spring Statement.
The Spring Statement can be accessed here. The Tax Plan can be accessed here. A press release from HM Treasury can be accessed here.
Key announcements include:
- R&D tax relief reform – from April 2023, all cloud computing costs associated with R&D, including storage, will qualify for relief. To support the growing volume of R&D underpinned by mathematical advances, the definition of R&D for tax reliefs will be expanded by clarifying that pure mathematics is a qualifying cost. Where required, legislation will be published in draft before being included in a future Finance Bill to come into effect in April 2023.
- Increasing National Insurance thresholds – The annual National Insurance Primary Threshold and Lower Profits Limit, for employees and the self-employed respectively, will increase from £9,880 to £12,570 from July 2022. The NIC threshold will therefore be equalised with the income tax threshold.
- Increasing the Employment Allowance – The Employment Allowance will increase from April 2022, meaning eligible employers will be able to reduce their employer NICs bills by up to £5,000 per year – a tax cut worth up to £1,000 per employer.
- Basic rate of income tax – The Government will reduce the basic rate of income tax to 19% from April 2024.
- Green reliefs for Business Rates – At Autumn Budget 2021 the Government announced the introduction of targeted business rate exemptions from 1 April 2023 until 31 March 2035 for eligible plant and machinery used in onsite renewable energy generation and storage, and a 100% relief for eligible low-carbon heat networks with their own rates bill, to support the decarbonisation of non-domestic buildings. The Government is bringing forward the implementation of these measures and is announcing that they will now take effect from April 2022.
- Levelling Up Fund second round – The Government is launching the second round of the Levelling Up Fund and publishes a refreshed Prospectus, inviting bids to come forward from all eligible organisations across the UK. This Fund provides £4.8 billion for local infrastructure projects, with £1.7 billion already allocated to 105 successful projects from the first round.”
Dr Richard Wilson OBE, TIGA CEO, said:
“TIGA welcomes plans to boost investment and innovation via reform of R&D Tax Credits. TIGA has previously called for measures to enhance R&D incentives.
“The Government should also aim to increase the rate of Video Games Tax Relief from 25% to 32%. This would create nearly 1,500 additional skilled development jobs and over 2,700 additional indirect staff by 2025.
“The Government should also introduce TIGA’s Video Games Investment Fund (VGIF), which would provide pound-for-pound matched funding, up to a maximum of £500,000, for original game projects. The VGIF would create over 1,200 skilled development jobs and indirect jobs by 2025 and increase studios’ investment by £78 million.”
TIGA
TIGA is the trade association for the UK video games industry. Our vision is to make the UK the best place in the world to develop video games. Our core purpose is to strengthen the games development and digital publishing sector. To this end, we focus on four strategic objectives:
- influencing Government policy via effective political representation;
- raising the profile of our industry to influence public policy;
- enhancing education and skills through our accreditation programme (https://tiga.org/education/tiga-university-accreditation) and TIGA Games Education Awards (https://tiga.org/education-awards); and
- promoting best practice through our membership services, including the TIGA STAR Employer Award (https://tiga.org/star) and the TIGA Games Industry Awards (https://tiga.org/awards).
For more information contact TIGA:
Tel: 0845 468 2330
Email: info@tiga.org
Web: www.tiga.org
Twitter: www.twitter.com/tigamovement
Facebook: www.facebook.com/TIGAMovement
LinkedIn: http://www.linkedin.com/company/tiga