B.C. Introduces "Interactive Digital Media Tax Credit"

Submitted by David Beckstead

The Vancouver Sun is reporting that last week, British Columbia's legislature passed a bill which would create an 'Interactive Digital Media Tax Credit' in the province with the hopes of making B.C. a more attractive location for digital media companies, including video game makers. The tax credit is reportedly the result of lobbying efforts by the B.C. Interactive Task Force, a group which is comprised, inter alia, of leaders in the industry which had apparently been pressuring the B.C. government for nearly a year to implement a tax credit program in the province. It is reported that stakeholders in the B.C. video game industry are hoping that the tax credit will help make the province a more attractive location for video game studios and thus raise its competitive advantage in relation to other North American jurisdictions. According to the Sun, the legislation will offer a tax credit of 17.5% for B.C. labour to digital media companies, and is set to begin on September 1, 2010.

While many industry leaders seem to be viewing the tax credit as a positive development, there are reportedly some concerns that the level of support that the B.C. government is offering is not sufficient enough to keep pace with benefits offered by other provincial governments. By comparison, Quebec, which the Sun refers to as B.C.'s principal domestic competitor, reportedly offers a tax credit of 37.5% of labour. While the tax credit will likely make B.C.'s profile more attractive to video game developers, the concrete impact it will have on the industry remains to be seen.