Despite games tax breaks featuring as a core policy in both the Liberal Democrats' and the Conservatives' manifestos, the Chancellor of the Exchequer, George Osborne, has cut Labour's pre-election plans in today's emergency budget.

This has been seen as a major blow for the games industry in the whose rapid growth, aided by tax breaks could have stimulated the country's ailing economy.

"The Coalition Government has broken pre-election pledges made by the Conservative Party and by the Liberal Democrats to support and introduce Games Tax Relief," said CEO, Dr Richard Wilson. "Unless the Coalition Government introduces Games Tax Relief or a similar fiscal measure then the UK will forfeit millions of pounds in inward investment, jobs will be lost and we will cease to be a leading developer of video games. The UK video games industry is export oriented, high tech, highly skilled and low carbon in output. This is an industry of the future, which the Government should be supporting with action, not words."

Rebellion's Jason Kingsley added: "TIGA has made a real impact in getting Games Tax Relief considered at the highest political level. It is hugely disappointing that the Coalition Government has decided not to introduce this tax measure, especially given the existence of tax relief for other sectors of the economy. However, TIGA will continue to lead the campaign for Games Tax Relief in the months ahead. Games Tax Relief or a similar fiscal measure is the industry's top priority. Other policy are entirely secondary. We need a tax environment which allows UK games businesses to compete on a level footing with our overseas competitors."

By Ewan Aiton