Digital firms need training tax breaks, Osborne told

A well-timed call to George Osborne for a training tax relief scheme for businesses that are small but creative has been sounded by two industry bodies.

TIGA, on behalf of games developers, and BIMA, on behalf of the digital sector, say the government should launch the scheme and operate it in a similar way to R&D tax credits.

The pair said they want SMEs to be able to offset expenditure on training, continuous professional development for staff and education outreach activities against corporation tax.

Their proposing of the scheme, which they described as “vital” to support the future of the creative industries, comes ahead of the chancellor’s Autumn Statement on December 3rd.

Dr Richard Wilson, chief executive of TIGA said: “This measure would enable developers and other businesses to finance management training, strategic skill development and promote investment in continuous professional development.

“It would also lead to stronger business-educational links. In the case of the games industry, more developers would have the incentive and resources to provide guest lecturers to universities, contribute to course development, participate in school, college and university career days and make work placements available.”

In outlining their proposal for SMEs to have a pilot ‘TTR’ (Training Tax Relief) scheme, the two industry bodies acknowledged that many UK employers already provide staff training.

But they said the duration of the training is much shorter than the EU average and, for however long it is provided, it tends to drain their resources, especially if the firm in question is small.

“The digital industry is a major growth sector for the UK economy, in particular SMEs, reflected BIMA’s Natalie Gross. “At the same time, there is not enough trained and skilled talent to enable these businesses to thrive and the UK economy to grow at the rates it could.”

She added: “We believe putting incentives for training into the hands of employers is the most expedient and potent way to move the UK digital economy forward, and tax relief will be a step forward in supporting the engine room of the sector, SMEs, to do so.”

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