Catch up: NSW extends screen tax rebate to game developers


Joseph Brookes
Senior Reporter

The New South Wales government has widened the tax rebate it offers visual effects businesses to include game developers in a bid to bring more video game companies to the state, following the lead of South Australia which made the same move more than a year ago.

Announced Tuesday, the New South Wales plan gives give digital games projects a 10 per cent tax rebate on eligible expenditure, a change the state government and the games sector industry association say will support local companies and help attract others.

It follows more support for the industry in South Australia and Victoria, and a commitment from the federal government to a 30 per cent tax off set for game developers from next year.

Ron Curry: NSW finally over the line on videogames support

From Friday, video game companies based in New South Wales will be eligible for a Digital Games Development Rebate of 10 per cent of eligible expenditure. The incentive is managed by Screen NSW and is effectively a widening of the rebate it already offers post, digital and visual effects projects based in the state.

Guidelines for the Digital Games Development Rebate are yet to be posted but are expected this week.

In 2020 South Australian became the first state to offer a dedicated taxpayer funded support to gaming companies, offering the same 10 per cent rebate available to post-production, digital and visual effects companies in the state (generally used by the film and television industries).

In May this year, the federal government announced a Digital Games Tax Offset will be available from mid-2022, offering eligible games businesses that spend a minimum of $500,000 on qualifying Australian games expenditure to receive a 30 per cent refundable tax offset.

In the same month, Victoria announced their own incentives for the games industry, widening its $190 million screen strategy to include videogames and promising to “supercharge” local projects with grants up to $300,000 on offer.

The changes, including New South Wales’s latest, have been welcomed by the industry, which has spent more than a decade advocating for government support.

“We’ve been working with New South Wales and trying to get them over the line to support video games, and for many years they haven’t,” Interactive Games and Entertainment Association chief executive Ron Curry told InnovationAus.com.

“They haven’t supported development at all, and we’ve seen states like South Australia and Victoria and Queensland really powering on. It just didn’t make sense that the country’s largest state wasn’t engaging.”

“So we are incredibly excited now that they’ve come over the line. We hope this is just the start of the support we see not the end.”

The state government support and the planned federal government tax offset makes New South Wales a more viable option for Australian and international games companies, Mr Curry said.

And while more support will be needed to compete with Victoria — where 40 per cent of game studios and more than half of developers are based — Mr Curry said the rebate change signals a change in mindset from the New South Wales government and will allow companies to “kick the tyres” on basing operations in the state.

“We [will] start see Investment NSW getting involved with [videogames], we start to the department of arts are involved in it. Then what happens is you have this kind of explosion of government rallying behind the industry which we’ve never seen.”

Minister for Jobs, Investment, Tourism and Western Sydney Stuart Ayres said the move would create jobs and help local games companies compete in the global $250 billion industry, adding the skills developed in the sector readily translate to others like space, defence and health.

“Our world-renowned universities and technical talent were already drawcards for the industry, and this incentive is the level-up that will make NSW the most desirable place for digital games companies to set up and export to the world,” Mr Ayres said.

“As an export-focused sector, this initiative will help NSW-based digital games developers showcase their skills and innovation to a global audience. It will also help them create more jobs as they look to take on the world in this highly competitive industry.”

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