Made in Massachusetts logo might equal tax breaks

A bill currently in front of  Massachusetts lawmakers could net the state’s current and future videogame developers, who place a “Made in Massachusetts” logo on their product, a 25 percent tax break on production costs if passed. House bill H03301 would also provide incentive to any developer making less than $1 million by offering an additional 35 percent reduction in payroll taxes for studio accounts. All of which would lead to the ability for the state’s developers to attract higher quality talent at improved wages.

The bill would help Massachusetts become a “safe haven” for developers, according to Dean Zerbe and Angelique Garcia, two tax gurus at Alliantgroup, a specialty tax services provider. After looking over the bill, the pair have also said that the bill would help studios with “most other non-payroll costs,” helping ease the cost of buying “computer hardware and software used in development, to expenses incurred in acquiring music for a soundtrack.” They went on to say that if the bill passes, the studios could possibly offer more employer provided fringe benefits, like “parking or other transportation subsidies,” as well as deferring the cost of rent of facilities.

Massachusetts currently offers tax breaks for film production done within the state and, were the bill to pass, would join Alabama, Arkansas, Connecticut, Florida, Georgia, Hawaii, Kentucky, Maine, New Mexico, North Carolina, Ohio, Rhode Island, Texas, Virginia and Wisconsin on a growing list of states that currently offer a tax relief policy for videogame studios.

The state, which is home to studio giants like Irrational Games, Turbine, and Harmonix has already lost at least one studio – 38 Studios – to the tax break friendly Rhode Island. Add into the mix a growing indie developer community, like Slambolt Scrappers creator Fire Hose Games, and Massachusetts could lose more than they gain if the bill is not passed.