The government should include tax breaks for the games industry in next month's budget, according to a trade body.
Tiga, the association representing the UK games industry, has claimed that British game developers are at a competitive disadvantage as firms in Canada, France, Singapore and the US benefit from tax breaks.
In a bid to create an even playing field, Tiga has proposed a Games Tax Relief initiative which would offer studios a tax break on any profit they make. Meanwhile, companies which make a loss could reduce the deficit by obtaining a cash tax credit to reduce the loss.
Conservative MP John Whittingdale said: "The global games industry has grown by 23 per cent through the global financial turmoil, and is projected to grow by over eight per cent each year to 2015.
"If the right support from government is forthcoming, the UK game development sector can take advantage of this projected growth, consequently contributing to the rebalancing of the UK economy."
In addition to the Games Tax Relief, Tiga proposed three measures for smaller developers: a Creative Content Fund, R&D tax credit expansion and training tax relief for small and medium-sized enterprises.