Tax relief loss may drive out Acti, Sony

Activision and Sony bosses have moaned that the loss of tax breaks for game developers in the UK may force them to shift their focus elsewhere instead.

"For us to continue to invest in the UK there needs to be an incentive provided for us to do so," Activision CEO Bobby Kotick, fresh from not bothering to advertise Singularity, told the Financial Times.

"The talent pool in the UK is among the best in the world for what we do. But we really need to see some more incentives. We are seeing great incentives in Canada, Singapore and eastern bloc countries."

Kotick wasn't alone in his views either - the FT also spoke to Sony Computer Entertainment UK boss Ray Maguire, whose company commands over 1000 development jobs at studios in London, Liverpool and elsewhere.

"The existing plans will continue but any further new developments would have to be looked at," he said. "Maybe something that was planned for the UK would go abroad now."

Last week chancellor George Osbourne revealed his emergency budget to try to reduce the UK's deficit. As part of that he said "planned tax relief for the videogames industry will be cancelled".

The news left publishing trade body ELSPA "puzzled" and "extremely disappointed" and its developer equivalent TIGA said the coalition government had "broken pre-election pledges".

The original tax relief plan would have offered financial incentives to companies making games that fit cultural criteria. TIGA boss Richard Wilson said in March that it would "increase employment, investment and innovation in the UK videogames sector".

The move would also have put British studios in a comparable position to those in places like Canada, where studios are already incentivised.

Our columnist Rob Fahey discussed the issue at length over the weekend, and you can also hear us go over it on this week's Eurogamer.net Podcast.