Tax relief for UK developers cancelled

Chancellor of the Exchequer George Osbourne has announced as part of the new budget that the Conservative and Liberal Democrat coalition government will cut plans to give UK game developers tax relief.

The announcement was part of the new 2010 budget speech in which Osbourne only said that the "planned tax relief for the videogames industry will be cancelled."

The promises for tax relief were made under the previous, Labour government and has been cut as the new Conservative and Lib Dem coalition seeks to reduce national debt.

Other budget highlights revealed so far include a two-year pay freeze for public sector employees who earn more than £21,000 GBP and a rise in VAT to 20 percent that will start in January.

Parts of the new budget were not met well by listeners and Osbourne was forced to explain that action was "unavoidable" given Labour's "years of spending and debt".

On the plus side, the new budget gives aid to new businesses setup outside of London, with some new companies set to qualify for an exemption from NI contributions for the first ten employees. It's hoped this move will help smaller developers to establish themselves more quickly.

Let us know your thoughts on the budget in the forums.