Due to the recent removal of tax breaks for the UK video game industry that were promised in the pre-budget report Michael Rawlinson, Director General of ELSPA, has stated that the industry must change to survive.

When the Conservative Government came into power they made it clear that numerous cuts must take place to ensure the UK's deficit is shrunk. Unfortunately for the video game industry this meant that the tax breaks that it was previously promised in the pre-budget report were removed.

Tax breaks operate to allow for companies to produce content without paying typical tax rates, with the intention of gaining the money back through profits and encouraging jobs. However, now that this will not be taking place it has put a greater financial burden on the UK video game industry.

Michael Rawlinson, Director General of ELSPA, has stated that companies within the UK must work differently in order to survive. He stated that in order to make money within the contemporary climate companies must be aware of how to best protect their intellectual property.

Mr. Rawlinson, along with senior Sony and Nokia executives, will speak at the new conference Digital Sparks at the University of Abertay Dundee in September. During this he will outline what he believes will be the best way to ensure that the industry not only survives this change but also continue to grow.

“The industry was extremely disappointed to see tax breaks pulled from under our feet. The Government is committed to rebalancing the economy, but without thriving creative industries the stability of the recovery from recession has to be in doubt...the brave new world is looking increasingly challenging, but there are still many, many new opportunities being created by digital distribution. But without a strong grasp of controlling intellectual property, companies are putting at risk all their hard work."

Without a doubt the future of the UK video game industry has been jeopardised by the removal of the promised tax breaks so it shall be interesting to see what Mr. Rawlinson, along with his peers, has to say at next month's conference and whether it will be enough.

For further information about Digital Sparks you can visit the conference's official website.