BRUSSELS — France’s tax break for video game production meets European Union rules on state subsidies, the European Commission announced Wednesday.
With tighter criteria, introduced after a commission probe, the tax break is now considered legitimate because it promotes cultural products.
The scheme allows vidgame manufacturers who pay tax in France to deduct up to 20% of a game’s production costs, if the game meets quality and originality standards, and contributes to cultural diversity.
“The French authorities have made significant changes to the scheme so as to essentially target video games with cultural content and minimize possible distortions of competition in the European market,” said competition commissioner Neelie Kroes.
The commission made subcontracting costs eligible for the tax break.