The Green Ribbon

Northern Ireland businesses put forward tax cut plan

Northern Ireland’s business leaders are not backing away from their demand for a corporation tax cut following the recent discussions with Gordon Brown. The subject made the front page of the FT today:

Companies in Northern Ireland would be exempt from corporation tax
on the first 60 per cent of profits under a private sector plan to be
put to the UK government on Wednesday in a bid to stimulate the
province’s economy.

The paper is published by the Economic
Research Institute, a local think tank, and backed by Sir George
Quigley, former chairman of Ulster Bank and head of the Northern
Ireland civil service. It represents the most detailed case yet made
for special tax treatment for the province, which is emerging from
three decades of unrest. (Financial Times)

The paper also has a further story which points to the rare agreement between the DUP and Sinn Fein over the issue.

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TomGriffin

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4 responses to “Northern Ireland businesses put forward tax cut plan”

  1. CW avatar
    CW

    Such an initiative would certainly be beneficial for the NI economy which is heavily dependent on the private sector. It would also put local businesses on a level playing field with their competitors south of the border. As both SF and the DUP support the move, it would be remarkable if it came into force, but given the European Court’s ruling that a similar tax concession by the Portuguese for the Azores was deemed contrary to EU law, it seems unlikely.

    Reply
  2. Tom Griffin avatar
    Tom Griffin

    The Azores ruling does allow for regional tax variations if the region bears the cost itself. Newton Emerson suggested in his column the other day that a corporation tax cut for Northern Ireland might actually be profitable. I think the real obstacles are political rather than legal.

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  3. CW avatar
    CW

    Good point, Tom. When you say the obstacles could be political rather than legal are you referring to the fact that Scotland and other regions may demand the same tax concessions in order to compete with London and other more affluent parts of the UK? I can see this as a major problem.

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  4. Tom Griffin avatar
    Tom Griffin

    That’s it exactly Ciaran. Having said that, knocking back a tax cut in Northern Ireland won’t necessarily lift the pressure for one in Scotland.

    Reply

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