Under a new tax benefits system proposed by the United States Congress, American developers of violent video games will not be eligible for the new “improved, permanent R&D tax credit.” The Reform Act of 2014 states that businesses in America are given the means they require to “compete against their foreign competition who have long had R&D incentives.”
The R&D tax benefit allows companies to successfully conduct research and development to further their businesses. This includes access to customer bases for marketing purposes, access to talent and (key to the games industry) stable information technology infrastructure.
Unfortunately, the document also states that companies who make violent games will be declined access to these credits, preventing developers from even qualifying for them. At this stage, it is not fully known what would constitute as “violent,” though according to the Supreme Court, a game is considered violent if it contains a “range of options available to a player [which] includes killing, maiming, dismembering, or sexually assaulting an image of a human being.” In this context, the new rule will likely affect game studios across the country, ranging from indie teams to large corporations such as Activision.
US political powers seem to be unable to decide how they feel about the video games industry. In complete contrast to this recent tax news, less than three years ago the Supreme Court sided with the industry after a six-year battle concerning the sale of mature games to underage customers.
The Tax Reform Act Of 2014 is available to read online for free (here), for any studios who are concerned about how this will affect them in the future.
With many developers across the US struggling to break into the industry, how will being excluded from the new R&D incentives affect how they operate as a business? Should studios simply stop making violent video games all together? Let us know in the comments below.