July 7,2025
RED FM News Desk
Video game and virtual reality (VR) developers in British Columbia will soon benefit from an increased tax credit for the interactive digital media industry.
“Video games are a vital part of our province’s economy, providing jobs to thousands,” said Premier David Eby. “We want to keep growing B.C.’s tech sector to create more opportunities for British Columbians. This enhanced tax credit will help developers hire more people, attract investment, and continue producing some of the world’s top games.”
To provide stability for the industry, the province has made the tax credit permanent and is increasing it from 17.5% to 25% starting September 1, 2025. Businesses can claim the credit on wages and salaries paid during the development of interactive digital media products, such as video games, educational software, and simulators.
“As a game developer and entrepreneur, I know how critical people are to the success of this industry,” said Finance Minister Brenda Bailey. These changes are meant to support the sector’s continued growth. According to Creative BC, the industry employs more than 20,000 people in the province and contributes over $1 billion annually to B.C.’s GDP.
Tech companies in B.C. can also participate in the province’s Integrated Marketplace Initiative, which is receiving an additional $30 million in funding to help tech firms test their products. Eligible small studios may also benefit from the newly expanded Venture Capital Tax Credit Program, which now allows individuals to invest up to $300,000.
The increased Interactive Digital Media Tax Credit was introduced in Budget 2025 as part of the government’s plan to grow the economy, attract investment, and secure jobs in B.C.
According to the Entertainment Software Association of Canada, B.C. is home to 161 video game companies and 230 immersive technology companies. Nearly half of these video game studios are small, with 10 or fewer employees. Major companies operating in B.C. include Microsoft, Nintendo, EA, Take-Two, and CD Projekt Red. The Interactive Digital Media Tax Credit helps companies offset labour costs incurred during product development. Other industries in B.C. eligible for income tax credits include film and television, mining exploration, shipbuilding, and book publishing.
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