08th Mar 2008
Corpo tax is a political call
Thank’s to the efforts of the ICAI, ERINI and the Industrial Task Force the campaign for a lower rate of corporation tax in NI has now been reduced to a political one. It is up to the northern executive with Dublin’s support to persuade the British government that a reduced rate should be granted. There are no other policy or economic arguments left, just political intransigence.
Dr Garrett Fitzgerald has an excellent article in today’s Irish Times(subs needed) in which he argues that Unionists have squandered several good political opportunities to kick start the Northern Economy. I don’t disagree with him although I would add that Sinn Fein has shown no interest what so ever over the past decade in economic policy. All through the negotiations leading up to the Good Friday Agreement it was the SDLP which sought to put the economy on the agenda.
That said with the Ian Paisley’s resignation announcement this week it is very unlikely that May deadline for the devolution of policing and justice powers will be met. This creates an opportunity to bargain again with the British. Peter Robinson as First Minister would be well advised to test his bargaining power with London to it’s limits in the course of the final negotiations around this issue.
Irrespective of the above London has a major role to play in ensuring the investment conference in Belfast at the beginning of May is a success. This is unlikely to be the case unless they show some movement on a decent package of fiscal incentives for NI. The ICAI floated the idea of attractive R&D tax credits at the Assembly’s Finance and Personnel Committee last week. Such a move would be a clear sign to potential investors that the UK Government is serious about supporting economic development in the North and that they are willing to concede the principle of variable rates of business tax within the UK.
Thank’s to the efforts of the ICAI, ERINI and the Industrial Task Force the campaign for a lower rate of corporation tax in NI has now been reduced to a political one. It is up to the northern executive with Dublin’s support to persuade the British government that a reduced rate should be granted. There are no other policy or economic arguments left, just political intransigence.
Dr Garrett Fitzgerald has an excellent article in today’s Irish Times(subs needed) in which he argues that Unionists have squandered several good political opportunities to kick start the Northern Economy. I don’t disagree with him although I would add that Sinn Fein has shown no interest what so ever over the past decade in economic policy. All through the negotiations leading up to the Good Friday Agreement it was the SDLP which sought to put the economy on the agenda.
That said with the Ian Paisley’s resignation announcement this week it is very unlikely that May deadline for the devolution of policing and justice powers will be met. This creates an opportunity to bargain again with the British. Peter Robinson as First Minister would be well advised to test his bargaining power with London to it’s limits in the course of the final negotiations around this issue.
Irrespective of the above London has a major role to play in ensuring the investment conference in Belfast at the beginning of May is a success. This is unlikely to be the case unless they show some movement on a decent package of fiscal incentives for NI. The ICAI floated the idea of attractive R&D tax credits at the Assembly’s Finance and Personnel Committee last week. Such a move would be a clear sign to potential investors that the UK Government is serious about supporting economic development in the North and that they are willing to concede the principle of variable rates of business tax within the UK.
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