The European Commission (EC) has launched an investigation into the proposed UK video games tax relief.
In 2012, UK Chancellor George Osborne announced the 25% tax relief on a maximum of 80% of the production budget of a qualifying video game for expenditure on goods and services used or consumed in the country.
The commission said it doubts whether aid is necessary to stimulate the production of such video games.
EC vice-president in charge of competition policy Joaquín Almunia said that the market for developing video games is dynamic and commercially promising.
"It is not clear whether the taxpayer should be subsidising this activity. Such subsidies could even distort competition," Almunia said.
BBC reported that Tiga, the association representing developers and digital publishers in the UK has expressed disappointment over the commission’s investigation on a planned tax break.
Last month, a research by Tiga found that employment in the UK games development sector rose by 4% in 2012 after three years of decline.
