Some video game developers are showing an interest in Ireland after the country recently launched a tax incentive program aimed at boosting investment and cultural awareness.
(Bloomberg) — Some video game developers are showing an interest in Ireland after the country recently launched a tax incentive program aimed at boosting investment and cultural awareness.
The program, which took effect in January, will offer a refundable corporation tax of as much as €8 million for expenditures on qualifying projects. The credit is available for companies that are resident in the European Economic Area — which includes EU countries as well as Iceland, Liechtenstein and Norway — and have business in Ireland.
Between five and 10 companies, some of which are publicly listed, are currently having discussions with the Irish gaming industry, according to Patrick O’Donnell, a board member of Imirt, the industry body. It’s the first sign that the tax credit could attract investment to the country.
“This credit is being examined closely and driving return on investment decisions between Ireland and other locations,” said O’Donnell, who is also an analyst at Goodbody Stockbrokers.
Take-up of the incentive could help put Ireland on the map in the global gaming market, which is anticipated to reach $504 billion by 2030, according to market researcher Grand View Research. It’s also seen as a way to leverage the country’s other established film, technology and animation sectors and to “support the expression of Irish and European culture,” according to the government’s statement.
Several other countries have incentives for gaming companies, including the UK, France and Canada, which all have thriving video game industries.
“With its high quality of life, technically skilled workforce and favorable corporate taxation, Ireland was already a very attractive place to establish a business,” said Craig Stephens, a board member of Imirt. The tax credit makes the country “even more appealing.”
Several other big-name game developers already have a presence in Dublin too, including California-based Activision Blizzard Inc. and Riot Games, which is owned by China’s Tencent Holdings Ltd. The games companies make up part of the Irish capital’s well-established wider tech scene, which includes the European headquarters of Twitter Inc., Meta Platforms Inc. and ByteDance Ltd.’s TikTok.
Attaching a cultural component makes Ireland’s tax credit incentive “particularly interesting,” said Maria O’Brien, a digital media and cultural policy lecturer at Queen’s University Belfast. “These requirements illustrate a pragmatic recognition of the need to establish a strong industry base in Ireland in order to develop games as a cultural form.”
–With assistance from Cecilia D’Anastasio.
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