30% tax offset would be a game-changer for industry: Ombudsman
The Australian Small Business and Family Enterprise Ombudsman Kate Carnell is backing the video game industry's call for a 30% tax offset, to ensure Australian producers are internationally competitive.
In its submissionto the Federal Government's inquiry into Australia's creative and cultural industries, the Interactive Games and Entertainment Association (IGEA) has recommended the tax offset to encourage productivity and help local producers secure a greater share of international contracts.
Ms Carnell says there is a strong economic argument as to why Australia's video game industry, which is comprised of many high growth potential small businesses and start-ups, ought to be supported.
"The video game production industry was worth about $250 billion globally in 2019, but the Australian sector earned a mere $114 million of that," Ms Carnell says.
"Internationally, we are seeing video game production industries in countries that offer tax incentives such as Canada, the UK and New Zealand securing substantially larger slices of the pie.
"For instance, in Canada, which offers a digital media tax credit on labour and certain marketing expenditures, the video game development industry employs more than 27,000 full time workers and generates $3.8 billion in revenue.
"Australia compares poorly with less than 1,300 full time workers in the video game production sector and earning less revenue that New Zealand.
"While the federal government invests $750 million annually in arts and culture, the video game sector continues to fall through the cracks.
"IGEA estimates Australia could create a $1 billion industry in game development, providing export revenue and employing an additional 10,000 full time workers with the right support.
"A tax offset for game development, similar to the incentives given to the screen production industry would be an excellent start."
