Games industry wins tax relief
TIGA, the trade association which represents the UK games industry has described plans to enhance R&D tax credits as a "decisive victory" for its members.
The announcement in the budget should be worth around £7 million to the video games industry, a spokesman said.
It will mean studios can invest more in research and development, as well as hiring additional staff.
But it falls short of the specific tax relief that the industry wanted.
Dr Richard Wilson, TIGA chief executive said: "The R&D tax credits will deliver 60% to 70% more value to games studios than the current tax credit regime."
But he was unhappy that the government had not gone further.
"Failure to deliver TIGA's Games Tax Relief is a dismal decision that displays a complete lack of imagination and one which will leave the UK video games industry swimming against the tide internationally," he said.
"Our key competitors have tax breaks for games production. The UK does not," he said.
Canada, for example, saw its games industry grow by 33% between 2008 and 2010, while the UK sector declined by 9%.
Plans by Labour to introduce tax cuts for the games industry were scrapped by the incoming coalition government during its 2010 emergency budget.