PS3 News: US Tax Reform Plan: No Tax Breaks For "Violent" Games - PS3 News

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US Tax Reform Plan: No Tax Breaks For "Violent" Games

This one's gonna generate a few nasty emails to the tax peeps in Washington.

The US Congress has released a blueprint for a complete overhaul of the American tax system, and it offers a variety of tax benefits for businesses. That's good to hear but there's another part that gamers are not going to like.

The document in question includes an "improved, permanent R&D tax credit" that will given American companies the "certainty they need to compete against their foreign competition who have long had permanent R&D incentives." Well, great. However, this tax credit won't be available across the board; specifically, studios that make "violent video games" won't qualify. The blueprint includes a provision for "preventing makers of violent video games from qualifying for the R&D tax credit."

Of course, it doesn't say how the government will label a game "violent." They could use the ESRB rating but that doesn't get applied until after the game is complete. If we're talking about research and development, everything is pretty darn vague at that point in the design process. So, is it just a judgment call on the part of the government?

I don't know who dropped in this little tidbit of idiocy, but it better go away. Either that, or we need a fantastic explanation.

Tags: violent video games, gaming industry, violent game tax, tax laws

2/27/2014 11:05:00 AM Ben Dutka

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Comments (17 posts)

LimitedVertigo
Thursday, February 27, 2014 @ 12:13:17 PM
Reply

What about companies that produce violent movies? What about violent sports like the NFL? As a country we continue to take one step forward and two steps back.

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WorldEndsWithMe
Thursday, February 27, 2014 @ 12:16:11 PM

The NFL is a socialized institution.

Agree with this comment 2 up, 0 down Disagree with this comment

Underdog15
Thursday, February 27, 2014 @ 3:06:58 PM

What about companies that make or sell weapons? We can't give tax incentives to violent video game makers who make fake, virtual guns... But I bet the people that make real guns will get the tax breaks!

What about people who make combat knives? Will the definition of a violent knife extend into the kitchen as well?

Agree with this comment 7 up, 0 down Disagree with this comment

Geobaldi
Thursday, February 27, 2014 @ 4:04:32 PM

The NFL is already tax free so they don't have to worry about tax breaks anyway for the most part.

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WorldEndsWithMe
Thursday, February 27, 2014 @ 12:15:38 PM
Reply

What a strange, nonsensical caveat to helping American business. I'd much prefer no tax breaks for companies that pay their employees such a small salary that everyone else's taxes keep them alive.

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ProfPlayStation
Thursday, February 27, 2014 @ 12:58:48 PM
Reply

Considering that this is talking about Research & Development, and manufacturers specifically, I'm sure this has more to do with encouraging practical, competitive technological development, and not so much with the video games themselves. What we're talking about with video games is a pure entertainment industry, and I'm betting that they're trying to differentiate between that and more fundamental technological research. This provision is in a whole long list of items that are meant to prevent abuse of the system. I.e. If I start making games in my basement, I'm not necessarily a researcher, and should not receive the tax credit. EA and Activision are most definitely not researchers, and not the kind of business that this is designed to assist.

This really doesn't seem to have anything to do with games...

Agree with this comment 4 up, 0 down Disagree with this comment

TGSA
Friday, February 28, 2014 @ 3:19:42 PM

Sorry Prof, but as a CPA specializing in taxation, I can tell you that the R&D credit can apply to software developers. There are a lot of intricacies with the calculation of the credit and what can qualify, but I can assure you that this will definitely affect and hurt most game developers if it ever goes through. On the bright side, I find it highly doubtful that this will pass any time soon.

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Lemon_Saint
Thursday, February 27, 2014 @ 1:03:25 PM
Reply

Does this mean Lockheed Martin will no longer get tax benefits? I mean they are known for their small-country destroying weaponry, which requires massive amounts of Research and Development. And what about the Dismounted Soldier Training System created by Intelligent Decisions for the US Army? Violence in bounds!

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Athrin
Thursday, February 27, 2014 @ 3:16:14 PM

As long as there are countries in the world that want to kill you, you better hope Lockheed martin and other weapons manufacturers keep on humming.

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BikerSaint
Thursday, February 27, 2014 @ 1:19:44 PM
Reply

Funny that our United States Senators, Congressmen, & other assorted politicians have a horrible history of being convicted of bribes, sexual crimes, influence peddling, etc, etc, but "NOT" any one company making a so-called violent game.

I suggest that the tax reformers go straight to them slapping them with enough fines & penalties to over-subsidize any tax breaks that should be given out to the decent folk making games, whether they're considering them violent or not.

And keep your #$&^%*%$^ mitts off my Manhunt 3!!!!
(if it ever comes out)

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Killa Tequilla
Thursday, February 27, 2014 @ 1:51:27 PM
Reply

Reading this makes my brain hurt.

Agree with this comment 3 up, 0 down Disagree with this comment

Athrin
Thursday, February 27, 2014 @ 3:18:34 PM
Reply

Considering that the video game industry make more that the Movie and music industry combined, and that everytime something bad happens and they find a gaming console they try and link the two together I think some lobbying was involved in this by 3rd parties that want to reign in the video game industry.

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matt99
Thursday, February 27, 2014 @ 3:52:51 PM
Reply

I still don't understand this aversion to violence in entertainment, and the belief that it's getting worse and how it's having such a negative impact on society.

Entertainment/literature/art has always included violence, just read Shakespeare, greek tragedies, or many great books written throughout history. It's always been there.

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Masszt3r
Thursday, February 27, 2014 @ 4:44:04 PM

It's not the same though, I think.

Violence has always been there, yes, but it was rare to actually "see" it visually and spread it to the masses as easy as it is today. Take Macbeth as an example. It's a slaughter fest at its finest, but you would only read it in a book or see it in the theater or play and it would not be as striking as seeing it graphically in a movie or game, if they try to adapt it as well as it is detailed in the original draft that is.

The same goes for porn or sexually explicit material; it has always been there, but it was much harder to obtain or share than it is today.

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PlatformGamerNZ
Thursday, February 27, 2014 @ 5:50:31 PM
Reply

well even study like mario and jak and crash and rachet and even the lego games can be consider violent cos you kill/take out enemies so well gud luck government you've made ur job difficult by not being specific enough.

happy gaming =)

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Simcoe
Thursday, February 27, 2014 @ 10:42:16 PM
Reply

Sounds like some publishers will be looking elsewhere when opening new studios or possibly relocating current studios to more friendly jurisdictions.

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Underdog15
Friday, February 28, 2014 @ 7:14:57 AM

Most likely, yeah! I live in London, Ontario. We're just an hour and a half from the US border. Our city gives big property tax breaks to video game companies who decide to set up in our downtown core.

We have 16 video game companies in town. Most of them are mobile game companies, but we have some big ones, like Digital Extremes.

Other Canadian cities are trying to attract game companies too, like Montreal, Vancouver, Winnepeg, just to name a few.

Our national government offers incentives for game companies specifically as well because, as the government put it, it's a multi-billion dollar industry that is growing, and Canada needs to be a part of that progress.

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