Additional games originating from Germany?
Germany Plans to Boost Video Game Industry with Tax Incentives
Germany is set to join the ranks of countries offering tax incentives for the video game industry, following a commitment made in the government's coalition agreement. The move comes as a response to the industry's significant growth in the first half of 2025, with turnover reaching €4.6 billion.
According to Hendrik Lesser of Munich-based company Remote Control Productions, the increase in funds is a sign that the topic is being taken more seriously in this legislative period than ever before. However, the specifics about the incentive rates or structure are not yet publicly established.
In comparison, countries like Canada, the United Kingdom, and France already have well-established tax credit programs for video game development.
Canada's Québec’s E-Business Tax Credit integrating AI offers a 30% total rate, with new payroll thresholds favoring higher-paid roles. The UK's Video Games Expenditure Credit (VGEC) provides a 34% credit on UK development spend, netting 25.5% post-corporate tax. France, known for its strong tax credits encouraging cultural content and game production, has historically offered up to 30%.
Germany's proposed incentives, once launched, are expected to stimulate investment strongly given industry studies on their multiplier effects. Every euro in tax credits could potentially generate ~4.80 euros additional investment.
Politicians from various parties have signaled approval for the plan to relieve German developer companies of taxes. Successful German games such as "Anno 1800" by Ubisoft, "Enshrouded" by Keen Games, and "Hunt Showdown" by Crytek have placed Germany on a growth trajectory in the internet age, with visual possibilities improving thanks to new technology.
Industry expert Malte Behrmann demands a different orientation of the funding policy, criticizing that international games corporations have so far received German funding but have taxed their profits abroad. Behrmann suggests that game companies that tax their profits in Germany should be particularly favored in terms of tax incentives.
The federal government is planning to provide direct subsidies of 88 million euros this year and 125 million euros in 2026 to strengthen support for German game developers. Green Bundestag MP Andrea Lübcke views gaming as "one of the central innovation and growth industries of the 21st century."
The Greens support tax incentives for games companies, viewing them as "a targeted investment in the future of the economic location Germany." Social Democrat Holger Mann also supports the tax breaks, stating "we must still enable investments today so that the German economy can grow and benefit the federal budget and, above all, the people in our country in the long run."
Politicians are working "at full speed" on this, with Federal Research Minister Dorothee Baer (CSU) emphasizing the urgency. CDU Bundestag MP Joachim Ebmeyer calls the proposed tax breaks "a very good instrument to increase the attractiveness of the location Germany for the games industry."
However, less than 5% of the money spent on games in Germany goes to games from the Federal Republic. The goal is to create conditions for the games industry that are common internationally, with the aim of stimulating investments and making Germany a more competitive player in the global games market.
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