Aussie game developers to get an extra tax incentive

The Federal Government announces an expansion to the Digital Games Tax Offset

Credit: Dreamstime: Framstock Footages

The Federal Government has today announced that it will provide a further AU$19.6 million over two years to beef up the Digital Games Tax Offset (DGTO) pledge that was made in this year’s Federal Budget.

The new announcement to back Aussie game developers expands the DGTO to include ‘live ops:’ that is, any changes, updates or improvements that developers make to games after their initial release.

Anyone who has played games online knows that games are rarely finished upon release, with the often laborious task of patching, fixing bugs and spotting glitches beginning soon after the beta test has dropped. Sometimes this process can take many years, if indeed it ends at all, with developers often called upon to fix errors spotted by gamers while playing.

Then there are the development projects that game developers take on to expand on the game’s experience, to keep players interested, and engaged with brands long beyond their release date. These projects are often labours of love for developers, when projects like adding extra features, mods, maps or other downloadable add-ons, often don’t produce a great deal of revenue.

Prior to this announcement, the Government’s initial DGTO of 30 percent for eligible developers, was announced for new games in development in which a minimum of AU$500,000 is spent, with an initial commitment of AU$18.8 million reserved in Government support. 

The extra $19.6 million for live ops projects will provide much-needed extra funds for developers carrying out post release projects that may otherwise fizzle out without the extra capital to support the programmers, developers and artists involved in the follow-up work.

KungFu Kickball by Australian game developer Blowfish StudiosCredit: Blowfish Studios
KungFu Kickball by Australian game developer Blowfish Studios

The Minister for Communications, the Hon Paul Fletcher said, “This additional investment recognises that a lot of valuable and highly skilled work in the industry is devoted to the ongoing development of games, after their initial release.”

The announcement has been well received in the Australian games industry, with the Australian games industry peak body the IGEA, expressing delight with the decision. IGEA CEO Ron Curry said: “The confidence and certainty that this provides to Australian video games businesses are immediately vital to the local sector as they strive to meet the growing global demand for video games and video games technology.”

The offset will be available from July 1 2022 for game developers that are Australian resident companies or developers with permanent establishment in Australia. 

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Tags gamesgaming newsfederal governmenttax incentivesgames developers

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Dominic Bayley

Dominic Bayley

PC World
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