Gaming Saving The UK Games Industry

TIGA CEO Dr Richard Wilson explains why R&D tax credits aren't enough.

http://www.bit-tech.net/gaming/2011/03/29/saving-uk-games-industry-tax-relief/1

 

All R & D in engineering not just gaming industry ought to be given tax relief / exemption, with the proviso that the money saved has to be reinvested back into the actual production and manufacture of goods in this country and not sent to low cost manufacturing plants in other countries.

 

At one point, the article mentions that Quebec is paying two-fifths of developer's salaries. Surely if that is the case, there is very little benefit to the taxpayer, and as such it is not sensible or cost-effective to be offering similar incentives in the UK, particularly at this time.

Another factor in where publishers invest is surely the availability of skills, and tax incentives do very little to change that, or am I being naive? From where I'm sat, the UK games industry seems in pretty good health, with an output and influence far in advance of the size of the country.

Sure, it used to be more, but as a country, we have to grow used to being overtaken in all fields as less advanced economies cath up and overtake our over-inflated position in the world.

 

What would help the gaming industry in the UK is if they stopped only offering jobs to people who have 5 years experience and a AAA title under their belt. I'm fed up of attempting to get a job in the industry with my degree and essentially being laughed at because I don't have experience.

Small companies can't afford to risk/train up an employee.
Big companies aren't interested.

So I basically have to go abroad to have any chance of getting a job.

 

I think that's an issue in all industries right now to be honest. There's a lot of unemployment, so when a position does turn up, a load of people jump on it who've got years of experience, and it's generally those who will be picked.

Of course, it was also an issue before the recession, just less pronounced.

 

So what happens when the tax relief stops? They just go elsewhere, ain't it easy for them to just up sticks and leave? All they've gotta do is move the office and staff?

 

Welcome to the race to the bottom. I'd like the UK to have a strong games industry - its a growing market and offers creative jobs. But when does a tax break become enough? We up our breaks, Canada responds in kind, the inevitable outcome is any desirable industry (which in a recession particularly is pretty much all industry) ends up on a marginal rate of tax, and its the public that foot the bill.

Of course you could have a tax system which takes this into account and charges accordingly the shareholders and execs who would profit. Obviously this wont happen though - if you charge the execs instead of the companies the effect is the same: the threat of a one way ticket elsewhere. Globalised business with only nation state regulation is a car crash. There is no 'games industry' solution to this, its the system that is broken.

 

Really?

That is easier said than done to move a office of 10/15 staff to another country, the staff themselves may not want to leave there mums/dads/brothers/sisters/friends and life in England behind - there staff will have partners/wifes/husbands that may refuse to go because of there ties to the UK...they may have kids in school, older teenagers/sons/daughters who may want to stay and live in the UK....who will pay for it too, i would not want my work to move me abroad without paying the costs, would they pay for x staff members new house because they have one here that they have paid 10 years of the mortgage on but is in negative equity/value?

Moving to a foreign country is a difficult and long term decision trust me i did it....and after 10 years of being here i am moving back home to New Zealand this year and for similar reasons i am dreading it because i have a career here in the police that i am giving up....my wife has her entire family and friend base here....we are leaving comfortable established lives here to go back although for a better lifestyle but still we are having to start from scratch again house and career's wise, the costs alone are around several thousand's of pounds and that is without moving furniture but taking personal belongings, visa's for new zealand for my wife are around £1k, flights £2k, moving our pets £3k, personal belongings £1k just for us and if we were moving entire furniture that can easier go upwards to the £5k mark ....so times those personal costs let alone business costs that by the number of staff and suddenly its not just a matter of just hoping on a plane...

So its not easy for anyone individual to up sticks and leave much less a company, they have to fund the move, there is potential for them to lose alot of there staff who refuse to go so it means more recruiting on the other side, loss of profit in the mean time because they cannot develop games etc.

So with all the costs its likely that it would take a games development company years to benefit from the tax breaks abroad because they had to pay out so much to get there in the first place and then there is always the risk that the "next government" in Canada/us/insert foreign country suddenly stop the tax breaks for the games industry in that country, things a company owner/director has to weigh up.

 

TBH it isn't just tax incentives for game developers but what about the general population. Yes I understand that taxes will go up and Im for it until we get this debt paid off but what Im not happy about is, Ive no confidence that prices will comeback down after. My biggest concern with working in the UK is cost of living. Regardless of profession, whats to keep working people in the contry to benifit from such tax breaks? Fuel £1.40 a litre, bread, eggs, milk all increasing in price (yet Tesco pulls in how many billion?). I don't wanna have to come home from a days work to tend the garden growing my own food. In a couple of years time I'll be looking to buy my first house never mind furnish it. Im lucky since I've saved up my student loan and invested it, means I'm not fighting as hard for bank loans (expensive and hard to get atm). Whats to stop taking that money an moving to America or even Germany where the software companies are just as plentiful and crying out for programmers?
Tax incentives for industry pffff tax incentives just to keep me in this dump!

 

Completely agree. As long as we live in a global economy there will always be other countries offering tax breaks better than ours in many industries. Personally I would rather no tax breaks for any companies to help raise tax returns rather than striping the country of services.

 

that would be a stupendous subsidy, but if you look at the value of Canada's creative industry compared to the total it dwarfs most developed nations by comparison.

 

"In particular, Canada, France and various US states are becoming more attractive places for large games publishers to invest, and this is seriously worrying many who work in the UK games industry."

As this fellow pointed out, subsidising industries isn't generally a good idea, but when its the industry that will provide the bread and butter for future generations who expect the same standard of living as we have today, it might well be worth it.

http://jedibeeftrix.wordpress.com/2...ng-field-uk-games-industry-to-get-tax-breaks/

 

Degree != guaranteed job. In every facet of life, especially true of the Games Industry.

No offence intended, but from what I've seen of the GI, it's all about starting in some "junior" role and working up, or having the experience to get the job you initially want - Degree or not

As for "saving the UK games industry".. There is no saving it. The Government won't give tax breaks, because the dev houses don't employ enough people on a permanent basis for it to be worth the effort.

 

Some companies are more generous than others. I work for a medium sized tech company (though not a game developer), and we offer in-house training to new starters on our graduate recruitment scheme. You could keep looking to see if any game companies offer something similar, or if you just want a development job in the tech industry (perhaps to gain that 5 years' experience required by the game devs), you could message me and I'll tell you about my company.

 

You do realise that its highly unlikely we'll pay off the national debt within our lifetimes? Its about to hit over 1 trillion pounds...and we're still adding to it every year even with the cuts. We've not even begun to pay it back! We should be investing in growing industries like the games one so the country actually has some money coming in and isn't almost entirely reliant on the financial sector as it has now become.

 

i do but the governemt has entered the pattern of screwing over its people. Look at labour, they sold everything like it was going out of fashion then took the attitue to spend their way out of trouble. Look at the NHS how poorly structured it is. Its lazyness and greed thats costing this country and rather than change attitues they fund the spending spee with tax hikes. Fact is we can't spend out way out of trouble, we need to invest in export buisness and becoming self sufficient ie. agraculture, fishing. To hell with Europe fishing quotas, and paying for failing french farmers or failing countries. Britain can't help others if it can't help itself.

Software industry in general is where we need to invest, not just games industry which is a small part. Yes entertainment is a huge market but when everything falls down, movies, games and luxery items are what I usually cut out first. I haven't bought a game myself since september last year! I only got 2 games as presents down from 7 or 8 the previous year. We need to invest in farming and manufacturing and actually get back exporting products. We have prisons full of able people, let them make products sweatshop style. Punishment plus useful. China isn't growing by sitting doing nothing.

 

Hmmm what about me, don't I deserve a tax break?
Or you, yes you *pointfinger* don't you deserve a tax break?

UK lowers their Tax, Canada lowers more, UK lowers more, Canada lowers more, then what, you start paying them?

The Semiconductor industry works this way, which is why (european*) semiconductor centers have moved from France (Grenoble), to Scotland (SiliconGlen), to Germany (SiliconSaxony)
In the end, billions of incentives have been turned out, but was any really sustainable?
All these sites retained some form of semicon manufacturing...

*something similar happened inside the US. From Silicon Saxony, to Austin to NY-State.

Reminds me a bit of Ryanair.
Demand built out airports, incentives, don't pay any landing fees, and when the city/county scraps the incentives, they move on to the next airport.

 

As long as Splash Damage get Brink out of the door in May, that's all i want.

Didn't i read somewhere that most of the succesful games developers in the UK are the smaller outfits coding games for mobile phones and other portable devices?

Not sure about tax breaks, but they should at least have as level a playing field as possible.

 

Canada give subsidies to game developers, so big names flock to get lower tax. More people employed in Canada, overall, Canada wins out.

Number of people doing game developer courses at uni atm is enough to increase the size of the industry by something like 50% in the UK.

I'm not sure why they encourage the courses so much tbh.

You could always go for indie development (maybe mobile), you might start off slowly but you'd have a job, and a portfolio that could go in lieu of experience