Alberta's video game industry assesses future after tax credit axed

As Alberta's gaming industry reeled in the wake of changes introduced as part of the provincial budget, industry leaders gathered in Banff Thursday attempted to chart a path forward.

Industry leaders from around the world gathered in Banff on Thursday

Keith Warner of New World Interactive, middle, said cutting the tax credit seemed to send a message that the provincial government did not have faith in the local video game industry. (Helen Pike/CBC)

As Alberta's gaming industry reeled in the wake of changes announced in the provincial budget, industry leaders gathered in Banff Thursday attempted to chart a path forward.

As part of the budget, the Alberta government proposed plans to axe the Interactive Digital Media Tax Credit, introduced by the previous NDP government.

The credit covered 25 per cent of salaries and bonuses for staff working in the industry. 

Keith Warner, president of New World Interactive, said axing the tax makes growing the gaming ecosystem in Alberta a lot harder.

"When you cut an investment tax credit, it's a statement beyond, 'We're trying to save money,'" Warner said. "It's a statement that says, 'We don't really care about this industry, or the cross-section of digital media.' 

"That's the way it does appear to all of us in the industry, that this industry is not something they want to bet on."

Insurgency: Sandstorm is a team-based tactical first-person shooter from New World Interactive, a U.S. video game developer that opened a studio in Calgary in February. (New World Interactive)

The U.S.-based video game developer New World Interactive, publisher of first-person-shooter titles Insurgency and Day of Infamy, opened New World North in Calgary in February.

At the time, Warner said he hoped to eventually quadruple the 12 to 15 people hired to open the Calgary studio.

But with the cancellation of the tax credit, Warner said he may now have to tap the brakes.

"Everything was on the positive side. Now, it's probably slightly to the down of neutral," he said. 

Scott Langevin with Serious Labs said the games industry in Alberta was in a holding position to try and determine the long-term impacts of the provincial budget. (Helen Pike/CBC)

Considering next steps

Scott Langevin with the Edmonton-based software company Serious Labs said the removal of the tax credit would make many Alberta-based companies seriously reconsider their growth plans.

"If we're not competitive, if we don't have some form of level playing field, then we can point to a couple of organizations that will go elsewhere," he said.

He said the local industry needed to provide hard numbers to the government to prove that the local industry was growing.

"Both Edmonton and Calgary have a great deal of vacant office space that this kind of industry can fit into quite seamlessly, through some kind of support," he said.

Luke Azevedo, commissioner of film television and creative industries with Calgary Economic Development, said the move to cut the tax credit already has companies turning away from Alberta.

"Obviously, the industry is disappointed with the transition and elimination of the tax credit. It creates more impediments to attract businesses here, as well as the talent that we'd like to see to continue to grow the industry," he said. "We've had great momentum in this industry in the last few years and we're hoping to continue that on."

With files from Helen Pike and Travis McEwan