New Zealand Needs Tax Rebate for Video Games

August 21, 2015 Taxation in New Zealand

WELLINGTON – Video game studios in New Zealand could compete against other international studios if the government provided appropriate tax incentives.

In a new statement released on August 21st the New Zealand Game Developers Association (NZGDA) called for video game production to be eligible for tax breaks just like high-budget film productions.

Currently overseas movie studios which move aspects of their visual effects production to New Zealand are eligible to receive a rebate of 20 percent on any qualifying expenditures, if the total production value is more than NZD 500 000.

In addition, productions with a smaller budget but with a significant economic contribution to New Zealand may be eligible for a smaller 5 percent rebate.

However, these rebates are not available to video game production, despite strong similarities between the work required for visual effects production for movies and video games.

The NZGDA suggested that providing tax breaks to video game production would only require the modernization of existing rebate system, but would result in the attraction of a greater number of large-budget productions to the country and greater business for local businesses.

It is estimated that the video game production sector in New Zealand currently sees revenues of nearly NZD 78 million.

Photo By: Dave Allen