Thursday, October 24th 2019 saw the United Conservative Party release the 2019-2023 Alberta budget.
Cuts were made across the board affecting hospitals, students, the disabled, teachers, municipalities, etc.
The local games industry was also affected.
The Interactive Digital Media Tax Credit that was brought in by the previous NDP government has seen success in the roughly one year that it operated. It offered a 25% refundable tax credit for labor costs as well as an additional 5% if under-represented employees were hired. It also made Alberta competitive as other provinces also have IDMTCs: BC (17.5%), MB (35%), NL (40%), NS (50%), ON (35%), PE (25%), and QC (37.5%).
The tax credit was partially or wholly responsible for bringing in Improbable IO (Edmonton) and New World Interactive (Calgary).
It was also being used by many midsized game studios that were created right here in Alberta. Small investments that were being rolled back into the businesses to continue to grow. It was truly a win win (unlike the $233 million Husky acquired from the new Alberta tax cuts which will be used outside of Alberta).
The following tweets summed up everyone’s feelings after the shocking news
Previous to #IDMTC we were at a disadvantage relative to other provinces. We had 18 full time employees. Under the belief the government had our back with the program leveling the playing field, we've grown to 52 staff. We had plans for over 100 full time staff in Alberta.
— Trent Oster (@TrentOster) October 24, 2019
Thanks to Interactive Digital Media Tax Credit, Trent’s company, @BeamdogInc, scaled up from 18 to 52 f/t employees w/ plans for over 100.
UCP has cut it in favour of a $4.5B corp giveaway that’s simply gone to line the pockets of shareholders. #ableg https://t.co/1aqfyvtPM6
— David Shepherd (@DShepYEG) October 25, 2019
What bad timing by the @Alberta_UCP to cancel IDMTC. #Alberta is hosting a major international conference on #gamedev next week. Investors and deal makers would've been promoted on investing here, now they'll be eyeing up talent they can poach as jobs are lost #ableg #yeg #yyc https://t.co/fLupmEGTCX
— Logan Foster (@LoganCDN) October 25, 2019
https://twitter.com/Kyle_Itzy/status/1187949989227454464
I’m super disappointed in the @Alberta_UCP and @jkenney. Losing the Interactive Digital Media Tax Credit is a huge loss for hundreds of jobs that would’ve been created in the gaming industry. The gov investment would’ve paled in comparison to the economic growth created in AB.
— Mike Lohaus (@DirkRugged) October 25, 2019
https://twitter.com/davechanedm/status/1187481977613512704
https://twitter.com/Kyle_Itzy/status/1187494988076081157
We budgeted more money to go to oil and gas propaganda than to helping Alberta businesses compete on an even playing field with other provinces.
As a young entrepreneur that benefited from the #IDMTC I am devastated by what our government has done. https://t.co/XTaP8pave1
— Johnny Guitar (@JohnnyGuitarDev) October 24, 2019
https://twitter.com/vladadraws/status/1187514451743956992
The removal of the Alberta Investor Tax credit and Interactive Dogital Media Tax credit is a stunning move. With these cuts Alberta became a much less appealing location for tech and video games, for a savings of $23.4 Million. Less than the cost of a “War Room”
— Trent Oster (@TrentOster) October 27, 2019
The government believes that lowering corproate tax rates from 12% to 8% over 4 years (1% per year) will benefit all business equally, but in reality this will only benefit large companies that have a foothold in Alberta (read: oil companies).
Investment, growth and diversity have all taken a hit with this announcement but we’re confident that we’ll continue to see amazing games and innovation out of our local game developers.
Additional reading:
'I felt betrayed': Gaming companies unsure of future in Alberta after tax credit axed https://t.co/9FKpxNGeoK pic.twitter.com/ywI1PmWrZV
— CBC Calgary (@CBCCalgary) October 26, 2019
'I would've made a different choice': Axing tax credit concerns video game industry in Alberta https://t.co/Hhir8naFDy
— CityNews Edmonton (@CityNewsYEG) October 29, 2019
I was interviewed with Dave Chan on Radio Active with Adrienne Pan – Oct. 25, 2019: Digital Media Tax Credit gets the axe https://t.co/LppEPfFzQN
— Trent Oster (@TrentOster) October 26, 2019
