The New Zealand Budget for 2023 has introduced major incentives for local game developers to retain talent and grow their business, as the global industry heats up. According to notes in the budget, the New Zealand Government has chosen to prioritise tax breaks for the games industry, as it’s a low-emissions and high-wage business with major growth potential.
These measures also address a talent drain that has impacted the New Zealand game development scene for years. In 2021, it was reported that New Zealand-based game companies had noted a major developer exodus from the country as Australia strengthened its own game development grants and incentives.
This trend, and the advancement of the Australian industry across the pond, encouraged studio leaders in New Zealand to speak out. Finally, lobbying has been met with tangible results as all game development studios in New Zealand will now be given a 20% tax rebate, as long as a minimum expenditure threshold of NZD $250,000 a year is met.
The rebate will reportedly total up to NZD $3 million per year, per studio.
‘We know from looking at advanced economies like Germany, South Korea, Japan and Singapore that the best investments you can make in the future of your economy are in science, skills and infrastructure,’ Ginny Anderson, Minister for the Digital Economy and Communications said of the decision, per Interest.
According to government analysis, the local New Zealand games industry contributed around NZD $7 billion to the country’s GDP in 2021. This has grown considerably over the last few years, thanks to steadily increasing interest in local New Zealand-made games – Path of Exile, Before We Leave, Umurangi Generation, and Dredge making up some of the country’s recent hits.
In addition to providing new tax breaks for the companies producing these games, the latest NZ Budget has also revealed new investments in digital skills, with the government pledging NZD $27 million to aid the tech sector in training and supporting new employees, as well as establishing school programs.
There is hope this investment will encourage people in all walks of life to learn more about the games industry, and how their skills can aid one of New Zealand’s fastest-growing sectors.