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Businesses Government The Almighty Buck United States Games

How Game Makers Like EA Mine for Tax Breaks 123

Posted by timothy
from the gold-farming-in-real-life dept.
Sometimes it seems like the U.S. government's relationship to commercial video games is mostly adversarial, as when public officials vilify or move to censor games (even when the results are mixed). An anonymous reader writes with a reminder that the business side of the games business has a much cozier government link, as reflected in this excerpt from the New York Times: "Because video game makers straddle the lines between software development, the entertainment industry and online retailing, they can combine tax breaks in ways that companies like Netflix and Adobe cannot. Video game developers receive such a rich assortment of incentives that even oil companies have questioned why the government should subsidize such a mature and profitable industry whose main contribution is to create amusing and sometimes antisocial entertainment." Since filling out even a simple return can be rather game-like, maybe they're just doing what they do best.
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How Game Makers Like EA Mine for Tax Breaks

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  • by Anonymous Coward on Sunday September 11, 2011 @11:33AM (#37368484)

    "why the government should subsidize such a mature and profitable industry whose main contribution is to create amusing and sometimes antisocial entertainment"

    Gotta have circuses with your bread.

  • by FooAtWFU (699187) on Sunday September 11, 2011 @11:37AM (#37368520) Homepage

    I think it works more like this.

    1. Have somewhat obnoxious business taxes.
    2. Hand out tax breaks to select businesses.
    3. Power!!!

  • Re:Oh please (Score:5, Insightful)

    by Anonymous Coward on Sunday September 11, 2011 @11:56AM (#37368650)

    From TFA, EA conforms to generally accepted account principles, or GAAP as we call it in the biz. So hop off me jet pack and don't assume because a company shows a loss they are sleazy, chadwhick. I find it quite amusing that the common folk just assumes every corporation has some evil voodoo master accountant, probably wearing a green visor with a bean counter too, sitting in the back room scheming how to make the common tax payer subsidize his/her (to be pc) business. The amount of rigamarole that a corporation such as a EA has to go through to even file its taxes costs more than what most of us make in the past 4 years combined. Yeah, the tax code has all these fancy dancy write offs, deductions and what not, but it also has something called phase outs. Yeah, phase outs. That means the nice little deduction that congress gave you, gets phased out over certain income levels. Take the article with a grain of salt. Its a complicated subject that takes years to master and it was written by somebody with a liberal arts degree who asked 2 questions to 2 people.

  • by Moryath (553296) on Sunday September 11, 2011 @12:27PM (#37368832)

    Why is it that corporations get tax breaks at all?

    Why is it that the ultra-rich, mostly Republicans, get to shuffle their income through loopholes like calling it "capital gains" (taxed at a mere 15%) while the middle class get robbed blind by the tax code?

    We should fix the tax code, that's no question. But the "fixes" supported by the Republicans are more Robber Baron style "crony capitalism", nothing more.

  • by Rayonic (462789) on Sunday September 11, 2011 @12:45PM (#37368950) Homepage Journal

    "why the government should subsidize such a mature and profitable industry whose main contribution is to create amusing and sometimes antisocial entertainment"

    Subsidy [reference.com]: a direct pecuniary aid furnished by a government to a private industrial undertaking, a charity organization, or the like.

    So the article writer assumes that not taking money is the same as giving money. That is some screwed up logic right there. It makes me wonder why we're subsidizing this writer (by not taxing his income at a higher rate).

    Sure, you can complain about the tax system and about all the tax breaks so-and-so qualifies for, but it's dishonest to say that the government is subsidizing EA. I'd even say it's pandering, since by the second paragraph they mention (and have a screenshot of) Dead Space 2. The implication being that "YOUR TAX DOLLARS" are funding "EVIL VIOLENT MURDER GAMES".

    At least it's marked as an editorial, right? Wait, no it's not.

  • by Wildclaw (15718) on Sunday September 11, 2011 @07:08PM (#37371674)

    The tax should be a fix percentage, like 25%

    A fixed percentage could only ever be ideal if it was a wealth/capital tax and not an income or sales tax.

    Fixed percentage income (and sales) taxes lead to positive feedback loops in wealth concentration, which at the very best hamper the economy severely and at worst causes a total economic collapse.

All constants are variables.

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