As state governments begin to recognize the economic potential of the video game sector, tax incentives have become an increasingly common strategy to lure - or retain - game developers.

Utah has now jumped into the tax break game in a big way, offering Disney millions in tax rebates to set up shop in the Beehive State. As reported by the Deseret News:

The Governor's Office of Economic Development Board on Friday approved a $5.25 million tax-rebate for Disney Interactive Studios Inc. if the company adds more than 500 jobs in Utah over the next 10 years to develop video games...

Disney already has a toehold in Utah, having purchased Salt Lake City-based Avalanche Software in 2005. The studio has produced family titles such as Chicken Little, Meet the Robinsons and Hannah Montana, as well as the highly controversial cops-and-robbers shooter 25 To Life. Disney also owns Fall Line Studio, which creates DS and Wii games.

Jerry Oldroyd of Utah's incentives committee told the Deseret News:

[Disney's] goal is to develop these two companies together here in Utah. The real goal, for us anyway, is to make sure that as much of that as possible is developed here in Utah.

The Disney deal is projected to offer significant benefit to Utah's economy. According to the newspaper report:

New jobs are expected to pay an average of $75,000 per year, which is more than twice the Salt Lake County median annual salary of $32,828. New state revenue is projected at more than $15 million over a decade, and new state wages are expected to top $330 million during the same period.