B.C. boosts tax credit for developers of video games, virtual reality simulators

The British Columbia government is boosting a tax credit to help developers of video games such as Electronic Arts hire additional staff and invest money locally. 

Premier David Eby said the interactive visual media tax credit will go from 17.5 per cent to 25 per cent starting Sept. 1, which is also when the credit will become permanent to give industry additional certainty.

Speaking at Electronic Arts in Burnaby on Monday, Eby said the changes will help the sector remain competitive as part of a larger economic response to American tariff threats, which was a "wake-up call" for the province to develop an economy that can stand on its "own two feet."

Finance Minister Brenda Bailey said the measures will help B.C. grow its "knowledge economy." 

Bailey said they could have raised the tax credit higher as other provinces have, but chose 25 per cent because B.C. already has a competitive tax system and other factors that attract global talent. 

Government agency Creative BC says the interactive digital media sector, which includes video games, virtual reality and educational software, employs about 20,000 people in the province and adds more than a $1 billion to the economy. 

Government figures show the tax credit program is expected to cost $141 million in 2025-26, $151.3 million in the second year and $180.3 million in year three. 2027-28. 

Natali Altshuler, chief operating officer for EA SPORTS Studios, welcomed the changes. 

Altshuler said the change recognize the value of the industry, adding that it enables companies such as EA to contribute to the provincial economy.

While EA ranks among the giants in the video-game industry, smaller developers are also welcoming the higher tax credit. 

Heidy Motta, the chief operating officer at game studio Coldblood Inc., said in a government news release that increasing the credit to 25 per cent "makes a real difference for indie studios like ours."

The Entertainment Software Association of Canada says B.C. is home to 161 video game companies and 230 immersive technology companies. 

It says almost half of all video game companies in B.C. consist of 10 or fewer people. 

The additional support from the provincial government also raises the question of possible reactions from the administration of U.S. President Donald Trump, who has previously criticized public support for industries from Canadian governments that he perceives to be unfair.

Trump threatened earlier this year a 100 per cent tariffs on foreign-made movies to help bring more productions back to the United States after B.C. announced higher credits in late 2024 to attract and keep more film productions in the province. 

Eby said B.C. made the decision to boost the credit for interactive digital media independently of any possible reactions. 

"We will cross the bridge's reactions when and if they happen," Eby said. 

Picture Courtesy: THE CANADIAN PRESS/Darryl Dyck