Tax Breaks For French Gaming Industry: Protectionism, or Art?

The New York Times reports that the French Government is taking several steps to protect the French videogame industry, which is one of the strongest in Europe. The article says the protection comes in the form of proposed tax breaks, but there's a hitch, notes the Times: Tax breaks go against European Union regulations which forbid state aid to national industries.

In an attempt to bypass EU regulations, The French Government is recognizing some videogames as artistic and cultural treasures, much like film, which receives hundreds of millions of dollars in special support every year. To this end, the French culture minister, Renaud Donnedieu de Vabres, recently awarded the Chevalier dans l'Ordre des Arts et des Lettres (Knight in the Order of Arts and Literatures) to two French game designers (Michel Ancel, who worked on Rayman and Beyond Good & Evil; and Frédérick Raynal, who helped create Alone in the Dark, and Twinsen's Odyssey) and Shigeru Miyamoto, the Japanese designer of Super Mario Bros. and The Legend of Zelda.

France is the home of Vivendi Games, Ubisoft Entertainment and Infogrames/Atari, which are all among the top 10 international videogame companies by revenue in 2005, says the New York Times. The paper adds that at least one French videogame maker supports the tax breaks, saying that they are necessary to keep jobs in France.