When Animal Crossing: New Horizons was released in March 2020, it was one of the sole games that kept people sane and connected to the real world. That’s just one part of what video games have the power to do. Beyond their clear benefits for mental health and wellbeing, they can also play a key part in Australia’s cultural transmission. Image: Necrobarista, Route 59 Government funding for the arts as a whole is generally based on the idea that screen entertainment has the ability to highlight Australian culture and values on the global stage. Beyond that, film it also has benefits for tourism and local employment.
The lack of funding for video games has mostly been chalked up to a misunderstanding of their purpose, and an ageing government that refuses to understand the value games have. In 2021, we’re also still dealing with mainstream commentators affiliating real-life violence with video games. That’s despite multiple studies refuting this claim and the clear benefits video games had on mental health in 2020 and beyond. But despite the overall financial success driven by Australian video games, developers still face financial challenges. Currently, Aussie developers earn only “five cents of every $100 in income generated by the sales of video games globally.” According to IGEA, this is because it’s 30% more expensive to make games in Australia due to a lack of tax incentives. This low return doesn’t just stunt the growth of the local industry, it also means developers struggle to earn a comfortable, full-time living in the country.
But ignorance is no longer an excuse. “Last year, Australia’s game development industry earned $184.6 million and employed 1245 full-time employees with 87% of this revenue derived from exports,” Ron Curry, IGEA CEO, said in a press release provided to Kotaku Australia.
With each passing Budget, more attention is paid to screen industries without consideration for how video games can contribute to the local economy and the arts. IGEA is calling on this to change in the upcoming Budget. “We’ve seen the film and TV sectors receive increases in funding over the last 12 months in order to attract global productions and boost the economy. If the same consideration was opened up to other screen businesses, like those who make video games and associated technologies, game development could attract international studios and generate revenue for Australia,” Curry said. That’s $650 million in revenue that the Australian government is passing up by not offering tax incentives and offsets for local developers.
“Over the last decade, the lack of attention, recognition and support provided to game developers by the Federal Government has already cost the Australian economy billions,” Curry said. “If Australia’s game development sector had grown at a 22% CAGR over the past decade — the rate that some overseas jurisdictions grew following its tax offsets — it would have earned $650 million last year alone.” Video games have that same ability, and it’s long past time for the Australian government to realise that.
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