Credit: Original article can be found here
The New Zealand Game Developers Association (NZGDA) met
with the Minister for the Digital Economy and
Communications, Hon Ginny Andersen, late last
week.
The purpose of the meeting was to further
raise concerns around the impact of the Australian Digital
Games Tax Offset (DGTO) policy, and to reiterate the
solution that the New Zealand Government should implement
immediately to stop the New Zealand sector being
decimated.
“It was a constructive meeting,”
Chelsea Rapp, NZGDA Chairperson said. “We can’t speak
for the Minister, but it appears the Minister understands
our concerns regarding Australia’s federal government
implementing a 30% Digital Games Tax Offset (DGTO) on top of
the existing 10-15% state rebates. That means that for every
$1 million of qualifying expenditure we could see a $450,000
cash benefit to New Zealand companies who move resources to
Australia rather than stay in New
Zealand.
“This is already seeing our top
talent poached by Australian companies, New Zealand
companies setting up in Australia, and international
investment being diverted to the Australian sector. If this
continues, our industry will be decimated and New Zealand
will be far worse off.
“New Zealand will lose its
fastest-growing export sector (47% growth p.a.). A sector
that ticks so many boxes for the government’s goals of
transitioning to a high-wage, low-emission, export-led and
diversified economy. It’s a landing pad for the “just
transition” to decarbonise the
economy.
“Worldwide, there are over 20 similar
schemes with 25% to 40% incentives, including in the United
Kingdom, Canada and Europe. New Zealand has nothing.
Finland, with a similar population to New Zealand, has
managed to grow its game development sector to over $5
billion.
“This is an urgent issue that needs urgent
action by our Government. The May 18th Budget is the time to
announce a policy response. The New Zealand sector needs
certainty now to retain and continue to grow the sector
here.
“We have asked the Minister to
introduce a 30% Interactive Digital Media Rebate to stop the
loss of highly-skilled talent to Australia. This would
protect our existing jobs and create thousands of additional
high-wage jobs over the next 10 years while lifting
wages.
“We estimate the cost of the policy at
approximately $35 million annually, which saves the $100
million our sector is already paying the government and
retains the growth path we are already on to the benefit of
all”.
“We need to know if the government is going
to ensure there is a level playing field with our Closer
Economic Relationship (CER) partner or not. We need to know
that the government actually supports the digital economy
and our sector, which is a critical component to its
success. We have urged the Minister to act.
“If our
government does nothing, it simply means it is happy for a
key component of the digital economy to be decimated, thus
consigning our fastest-growing, green jobs, leading-edge
sector to the dustbin.”
“We have asked the
Minister to act. Yes, we understand that every budget is
about juggling priorities, and that this one will be no
different. The challenge is whether the Government can see
the strategic imperative for levelling the playing field by
investing in such an important up-and-coming sector for New
Zealand’s future,” Ms Rapp concluded.
For
more data on New Zealand’s interactive media sector see:
https://nzgda.com/news/nz-interactive-media-industry-survey-2022/