The UK has been promoting video game developers for more than five years, whose product is of cultural value to the United Kingdom. The idea of tax breaks for the interactive entertainment industry was first voiced in the British government in 2010. However, it was only after lengthy discussions in 2014 that the British persuaded the European Commission to give the green light to the benefits. They can be used by both startups and companies that have long been represented on the market.
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One of the main lobbyists was the British Association of Interactive Entertainment (UKIE). Experts also cited the example of Canada, where tax breaks for gamblers have long been tested and sometimes reach 40%. UKIE Public Relations Chairman Tim Scott, who was involved in the development of the Video Games Tax Relief as a civil servant, described the mechanism as a form of financial support to the government for the cost of developing video games in the UK. You may be charged some taxes or a loan to be paid.
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There are a number of requirements for those wishing to receive benefits. For example, at least half of the conceptual development, storyboarding, programming or design must take place in the UK. The application evaluation system also encourages additional scores for dominance in the UK's indigenous video game dialogues, including Welsh and Gaelic. The UK's tax incentive program in the UK is expected to remain unchanged until 2023.
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Earlier, with government support, Rockstar Games created more than 1,000 jobs for highly skilled programmers in London, Lincoln, Yorkshire and Edinburgh. However, taxation needs a major overhaul. This conclusion was reached by TaxWatch in its report Gaming the System. Analysts claim that due to offshore, the real profits of Rockstar North (Edinburgh, Scotland) were hidden. Parent company Take-Two Interactive's revenue was $ 55 million, while the bonus fund for top managers was replenished by $ 3.4 billion. According to The Guardian, tax evasion is typical of many large video game companies. Thus, the British treasury received less than £ 20 million from the European branch of SEGA.
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Take-Two Interactive fell 7% after Dan Hauser, co-founder and lead writer of Rockstar Games, recently left the studio. Grand Theft Auto 5 became the studio's best-selling video game and brought the creators about $ 6 billion in sales. The government's tax relief program in the UK is expected to remain in place until 2023. Since its introduction, Rockstar Games has received a subsidy of £ 80 million.
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In Ukraine, support mechanisms for IT companies, including gamedevs, have been repeatedly discussed at various levels. The latest event was Bill №2615, which provided tax benefits for startups, but we will pay special attention to its analysis.