Press Room.
Budget provides some encouragement to uk technology
industry
If you are writing on the impact of today's Budget
announcements on the technology sector please consider the comments
of Niki Dixon, Head of Technology at Grant Thornton.
"Today's Budget announcement of a similar tax relief for the
video games industry as that given to the film industry is welcome
news but has been a long time coming. It represents a breakthrough
following vigorous lobbying to secure recognition of the importance
of the video games sector to the UK economy.
"While the Government's intentions are good there are no details
of how and when the tax relief would be implemented and any changes
will be subject to EU approval so that they do not fall foul of the
State Aid provisions. It follows that it may be some time before
the video games industry starts to feel the benefits of any tax
relief and the announcement will do little to ease the immediate
challenges facing the industry as it competes on the global stage.
The tax relief is also dependant on the outcome of the election as
there is no guarantee that the measure will be implemented if there
is a change of Government.
"With the exception of the video games tax relief, it was
disappointing to see that there are few other industry-specific
measures announced in today's Budget outside promises of funding
support for University spin-outs.
"Some of the general measures announced to encourage investment
should benefit technology businesses such as the extension of
Entrepreneur's Relief and the modernisation of the rules around
Venture Capital Trusts and the Enterprise Investment Scheme to meet
EU requirements. There will be a relaxation of the rules requiring
businesses to operate mainly in the UK, which will be replaced with
a requirement to operate only a part of the business in the UK.
This will make it easier for technology businesses which operate in
multiple locations to qualify for these schemes.
"It was also encouraging to see that there will be further
consultation on the Patent Box regime which will reduce the rate of
tax on relevant income to 10%, however the introduction of the
measure was not brought forward and is still scheduled for April
2013."
For further information, please contact:
For further information, please contact: Lisa Ritchie, Grant
Thornton Press Office: 020 7728 2208 or email:
lisa.ritchie@gtuk.com