Announced in last year’s Budget, the scheme is designed to support Ireland’s digital gaming industry and promote culture in the EU.
The European Commission has approved a €20m tax credit scheme in Ireland to support the development of digital games that promote Irish or European culture.
First announced in last year’s Budget, the measure is aimed at encouraging projects that “contribute to a varied cultural landscape and that enrich the European digital audiovisual sector”.
It will see the provision of a refundable corporation tax credit for qualifying expenditure incurred on the design, production and testing of a game – available at a rate of 32pc on the eligible costs up to a maximum cap of €25m per project.
The scheme, which will run until 31 December 2025, will be open to digital games development companies paying tax in Ireland.
“This sector has seen exponential global growth in the past decade,” Minister for Finance Paschal Donohoe, TD, noted in his Budget speech last year. “However, employment growth in the sector in Ireland has not matched this global trend. The relief will support digital games development companies.”
The scheme required approval from the European Commission under EU state aid rules, and was assessed under the article that enables member states to grant aid to promote cultural and heritage conservation in the EU.
The Commission found the scheme to be “necessary and appropriate” to promote the development of cultural and educational video games. It also said the measure is “proportionate” and does not raise any competition concerns with other member states.
In a piece written for RTÉ last year, Queen’s University Belfast lecturer Maria O’Brien said that the move marks a recognition of the fact that “culture is not only contained in literature and films, but is visible in multiple art forms”.
“The introduction of the credit is not merely to encourage people to take up gaming as players. Instead, it is a well-measured and significant support to an industry with much potential,” wrote O’Brien, who was researching film finance policy at Dublin City University at the time.
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