As Ontario reviews a provincial tax credit aimed at luring video game producers, a number of groups are lobbying to hang on to, or redirect, the credit which they consider a vital part of Ontario’s high-tech economy. Others argue it has turned into a costly measure tapped by many other companies including financial institutions, manufacturers and media outlets.
The Ontario Interactive Digital Media Tax Credit (OIDMTC) was unveiled more than a decade ago as an economic development effort targeted at the fledgling video game industry. For years the credit was largely unused, but that changed in the mid-2000s when the government began boosting the value. Since then a flood of claims has poured in.
In 2009, tax credits amounted to $9.6-million. That jumped to $38.3-million the next year, and then soared to $75.1-million in 2012-2013.
In the fall 2014 economic update, the finance ministry called for a review of “the scope and parameters of this credit” in part because it had “grown at an unsustainable rate.”
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