IGEA Attends Lower House Committee Hearing to pitch Tax Offsets for Game Developers

The Interactive Games & Entertainment Association have submitted a bid to the Australian Government to grant game developers tax offsets.
November 29, 2019 7:00 PM
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Speaking at a lower house Joint Standing Committee for Trade and Investment Growth today, IGEA CEO Ron Curry alongside IGEA Chair and Ubisoft Australia Managing Director Edward Fong made a bid for a tax offset for the Australian Games Development Industry.

IGEA said in a policy recommendation a 30 per cent tax offset for game development would foster the growth of Australian studios while attracting large developers to set up studios in Australia, bringing jobs, projects and investment with them.

IGEA CEO Ron Curry

IGEA CEO Ron Curry said this kind of offset would provide great returns in tax revenue.

Curry’s modelling was based on research done in the UK and France that showed how significant these returns can be.

“In the UK… 78 million pounds that they provided in offsets generated 156 million dollars in tax revenue,” he said.

Fong said the model should be similar to the film industry, an industry he said is closely related to the games development industry.

“At the moment these incentives apply to film and television production, we’re just talking about expanding that definition to screen content production,” he said.

The reasoning behind this was the number of consumers engaging with game screens is larger than those engaging film and TV.

“We just need to catch up, you know, we are as a country, we are way behind at the moment,” he added.

Fong said Ubisoft would be willing to consider expanding their studios into Australia, and that they are regularly opening new studios around the world.


Ubisoft's newest studio opened in Da Nang, Vietnam in September

 

“They want to work with us and incentivise us to be there… there’s huge growth not only in Ubisoft, but the market itself,” he said.

He said the money being made on large games is significant, with games like Fortnite still being played by more people every day.

According to Fong, Australia is missing out on this money from a production point of view, and there is a huge opportunity for Australia to tap into.

“We’re way behind the eight-ball already, and we need to catch up,” said Fong.

He added that Australia already has great talent, infrastructure and education system, providing a huge opportunity to grow the industry to make larger games.

Fong said the big studios left Australia following the financial crisis when the AUD exchange rate aligned with the USD, leaving the last triple-A title made in Australia as L.A Noire by Team Bondi in 2011.


 

“Australia is getting a reputation or a question mark around whether or not Australians can actually make the big triple-A games,” he said.

Education for games development is not an issue, according to Fong Australia’s education is great, but compared to other countries, Australian graduates are faced with tough decisions to start and advance their careers.

Fong said that in other countries graduates would work their way from small studios through medium-sized studios and into larger studios, a path not readily available in Australia, where this ecosystem has a void of medium to large-sized studios.

“At this point in time, when they hit that glass ceiling, they’re forced with a decision; do I move overseas or do I change careers?” said Fong.

Fong said introducing a tax offset would work toward completing that ecosystem, which would demonstrate to young people that there is a career pathway beyond the current short or out of industry pathway.