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Scrapped Tax Relief Could Cost UK Sony And Activision

30 Jun 2010  by   Paul Younger

Activision boss has told the Financial Times that the government’s decision to scrap tax relief for UK developers could mean Activision would look elsewhere to start projects and studios.
And it’s not just Activision, a relatively small player in comparison to Sony in terms of development teams in the UK. Sony Computer Entertainment UK has six of its 15 in-house international production teams here, including Media Molecule, Evolution and SCE London, while Activision is host to Bizarre Creations and FreeStyleGames.
“The talent pool in the UK is among the best in the world for what we do,” Kotick said. “But we really need to see some more incentives. We are seeing great incentives in Canada, Singapore and eastern bloc countries.”
And we’ve already seen Ubisoft invest heavily into Canada, with other Canadian studios also benefiting from both federal and provincial tax breaks (Silicon Knights’ recent investment case in point).
But Sony’s head man in the UK, Ray Maguire, said that it could have a further impact on future projects.
“The existing plans will continue but any further new developments would have to be looked at. Maybe something that was planned for the UK would go abroad now,” said Maguire.
The announcement was also met with anger and disappointment from both TIGA and ELSPA, with TIGA CEO Richard Wilson stating the government had “betrayed” the industry by going back on their word.
“This is a big mistake from the government and the industry is going to lose millions of pounds as a result, meaning it won’t progress. We have to have specific measures to help the industry,” Wilson told IncGamers.
Even Ed Vaizey, minister for culture, communications and creative industries told IncGamers he was “disappointed” with the decision, but he’d have a plan and proposals next month to find a way to “best support the games industry.”
These plans will most likely be announced at the Develop conference in Brighton next month.
We’re still trying to chase the Treasury to get a little bit of clarification as to what this means to the industry as a whole, and why the U-turn was made. We’ll obviously let you know as the story progresses, but if you want to find out more you can check our stories here, or even listen to the mass debate on our podcast.

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