Video Games: Tax Allowances
The question
To ask the Chancellor of the Exchequer, whether she plans to review the Video Games Expenditure Credit to support smaller video game studios.
Answered by Dan Tomlinson
The Government recognises the importance of the creative industries, including the key role they play in driving economic growth, and the video games sector is specifically supported through the tax system and through funding.
Video games companies benefit from the Video Games Expenditure Credit (VGEC), which provides a generous tax credit of 34 per cent on UK video games development costs. In 2023-24, £327 million of Corporation Tax was relieved through video game tax relief.
VGEC makes no distinction between large and small game studios. Any video game production company can qualify as long as it meets the eligibility criteria. The Department for Culture, Media and Sport has committed to a new £30 million Games Growth Package over three years to back the next generation of start‑up games studios and talent, and drive inward investment in the sector.
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