A lot of things could be said on the subject, but consider that despite it's increasing size the game industry as a whole isn't all that big economically speaking. It's small enough where in the US it flagrantly engages in types of behavior that get other businesses (like gas companies) in trouble and under ongoing federal investigation.
While Canada DOES have a military, it's not a military power, and doesn't in general have as much on the table as the UK does at any given time. This gives it more leeway to encourage smaller industries through things like tax breaks, when they aren't plausible for larger nations, especially ones still dealing with recession.
All theories about why the UK goverment didn't give the tax break aside, the bottom line is that they obviously had reasons, and we're unlikely to ever know what they are in their entirety. Personally, I tend to notice that the game industry is so quiet about their numbers that even analysts have to make massive guesses about what it's actually work and what it's making. The last time I checked last year it was estimated that the game industry made between 19 and 50 billion dollars in profit. That's a huge variance. Not to mention the various other discussions I'm involved in here when it comes to those profits. The bottom line is that if I was in the goverment I wouldn't be approving tax breaks for an industry that is this secretive, because to be honest it's as likely as not that instead of encouraging actual growth, a lot of the people involed are just going to use the tax breaks to effectively pocket more money.
I know it's interesting/big news to us gamers, but overall I don't think this is that big a deal overall.
Also, as far as the whole "I'm moving to Canada, it's such a nice place" thing, really I'd do some more involved homework. All politics aside, as far as the civilized world goes Canada is actually one of the more oppressive countries out there, though arguably a lot of the people living there do not realize it. I say this because when I was taking Criminal Justice (well over a decade ago) comparisons were being made between the standards of the US system of Justice and our standards, versus that of some of our closest allies. One of the subjects that came up had to do with warrents, and the fact that Canadian law enforcement (at least at the time) had a "blank warrent" which pretty much allowed them to ignore all of those pesky civil liberties anytime they wanted to, as long as they got results. So, while on the surface Canada has very similar laws to the US, in practice none of those laws actually matter since the police can pretty much do whatever the heck they want, justification happens later, and while admittedly they can get in trouble for going overboard, that also depends on what they find.
At least when I was in class, the system was being compared (loosely) to others similar to it. Generally speaking the only nations that have given police powers anywhere near that level are countries like China.
Now, how things have changed in over a decade is beyond me, but the bottom line is that from what I remember this was the truth, and it wasn't that long ago.
It also brings up another interesting point, about where it was determined that most Americans have a better general idea of their rights, and legal system than the citizens of most other nations. This is in part why Americans are so "sue crazy", and the police have to be on their toes to some extent. A counter point to the various jokes people make about failings in unused "general knowlege" like geography and so on. Again this could have changed though.
