TIGA Welcomes Budget Plans to Promote High-Skilled Migration, but Calls on Government to Enhance Video Games Tax Relief

By March 3, 2021 Press Releases

TIGA, the network for games developers and digital publishers and the trade association representing the video games industry, welcomed the Government’s plans to improve the migration system and R&D tax credits and 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 Shunak’s delivery of today’s Budget.

The key aspects of today’s Budget are set out below.


High-skilled migration – The government will:

  • introduce, by March 2022, an elite points-based visa. Within this visa there will be a ’scaleup’ stream, enabling those with a job offer from a recognised UK scale-up to qualify for a fast-track visa;
  • reform the Global Talent visa, including to allow holders of international prizes and winners of scholarships and programmes for early promise to automatically qualify;
  • review the Innovator visa to make it easier for those with the skills and experience to found an innovative business to obtain a visa;
  • launch the new Global Business Mobility visa by spring 2022 for overseas businesses to establish a presence or transfer staff to the UK;
  • provide practical support to small firms that are using the visa system for the first time
  • modernise the immigration sponsorship system to make it easier to use. The government will publish a delivery roadmap in the summer;
  • establish a global outreach strategy by expanding the Global Entrepreneur Programme, marketing the UK’s visa offering and explore building an overseas talent network.

R&D tax reliefs – The government will carry out a review of R&D tax reliefs, with a consultation published alongside the Budget. This review will consider all elements of the two R&D tax relief schemes. The government will consider bringing data and cloud computing costs into the scope of relief alongside a number of other policy options and priorities at the wider review.

Corporation tax – the rate of corporation tax will increase from April 2023 to 25% on profits over £250,000. The rate for small profits under £50,000 will remain at 19% and there will be relief for businesses with profits under £250,000 so that they pay less than the main rate. In line with the increase in the main rate, the Diverted Profits Tax rate will rise to 31% from April 2023 so that it remains an effective deterrent against diverting profits out of the UK.

Super-deduction – From 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will benefit from a 130% first-year capital allowance.

Help to Grow: Management – The government will offer a new UK-wide management programme to upskill 30,000 SMEs in the UK over three years. Over 12 weeks, and 90% subsidised by government, this programme will equip SMEs to grow their businesses.

Help to Grow: Digital – The government will launch a new UK-wide scheme in the autumn to help 100,000 SMEs save time and money by adopting productivity-enhancing software. This will combine a voucher covering up to half of the costs of approved software up to a maximum of £5,000, and free impartial advice, delivered through an online platform.

High quality traineeships for young people – The government will provide an additional £126 million in England for high quality work placements and training for 16-24 year olds in the 2021/22 academic year. Employers who provide trainees with work experience will continue to be funded at a rate of £1,000 per trainee.

Payments for employers who hire new apprentices – The government will extend and increase the payments made to employers in England who hire new apprentices. Employers who hire a new apprentice between 1 April 2021 and 30 September 2021 will receive £3,000 per new hire, compared with £1,500 per new apprentice hire (or £2,000 for those aged 24 and under) under the previous scheme.

Supporting apprenticeships across different employers – The government will introduce a £7 million fund from July 2021 to help employers in England set up and expand portable apprenticeships.

Business rates reliefs – The government will continue to provide eligible retail, hospitality and leisure properties in England with 100% business rates relief from 1 April 2021 to 30 June 2021. This will be followed by 66% business rates relief for the period from 1 July 2021 to 31 March 2022.


Dr Richard Wilson OBE, TIGA CEO, said:

“The UK video games industry depends on a high skilled workforce. Approximately 25 per cent of the UK’s existing games development workforce comes from overseas. TIGA supports the Government’s intention to improve the UK’s immigration system to enable creative and high technology sectors such as the video games industry to recruit highly skilled, globally mobile talent.

“The Government should aim to maintain a rate of corporation tax which is lower than the G7 average and which serves to attract investment to the UK. Increased rates of corporation tax need to be matched by tax reliefs which encourage investment in physical and digital assets and skills in order to enhance productivity in the UK.  The two year ‘super deduction’ of 130 per cent for corporate investment in capital spending is good for manufacturing. Unfortunately, this incentives does little to help the UK’s service sector (including the creative industries) which represents 80 per cent of UK economic output and approximately four fifths of employment.

“TIGA supports the Government’s intention to improve the R&D tax reliefs. 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.”


Notes to editors:

In 2019, the service industries accounted for 80% of total UK economic output (Gross Value Added). Services accounted for 82% of employment in July-September 2020 (https://commonslibrary.parliament.uk/research-briefings/sn02786/).

The 25 per cent tax rate for corporation tax is less than the G7 average of 27 per cent (Hollinger, Peggy, Thomas, Daniel and Steer, George, ‘UK business leaders warn tax rise could undermine investment push’, Financial Times, 4th March 2021).

However, the UK’s new corporation tax rate appears less competitive in comparison to the OECD average. In 2018, the OECD said the UK taxed corporate profits below the rich country average. Britain collected 2.6 per cent of national income through the levy, compared with the OECD average of 3.1 per cent. By 2025-26, the OBR projections suggest UK corporate taxes will generate revenues above the OECD average( See Giles, Chris, Sunak goes big and bold in bid to repair UK public finances’, Financial Times, 3rd March 2021). Once deductions and allowances are included, corporate profits will be taxed more heavily than in other advanced economies. Britain will raise 3.2 per cent of national income through the tax, according to the OBR, by 2025-26 — the highest for more than three decades (‘A tactical budget that spends today and taxes tomorrow’,  Financial Times, 3rd March 2021).




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