The EAG has renewed its call for a decision to be reached soon on devolving Corporation Tax to Northern Ireland.
At the EAG’s last meeting on 13 October 2014 the group discussed the economic implications of the devolution of Corporation Tax to Northern Ireland.
The Chair of EAG, Dame Kate Barker DBE said, “Following commitments made around the Scottish referendum there is now a clear drive to devolve more powers to regional governments, and this must start with the UK Government concluding on the long awaited plans for the NI Executive being offered the powers to set its own rate of Corporation Tax.
“Less than two weeks ago, the Scottish government published their proposals for greater powers, which included full autonomy for Corporation Tax. We have been calling for this measure for Northern Ireland since May 2011.”
Reflecting on the potential impact that Corporation Tax could have on rebalancing the Northern Ireland economy, Dame Barker said, “The work carried out by EAG in May 2011 presented a very strong case for Northern Ireland to gain control over these powers and reduce its rate of Corporation Tax to 12.5%.
“A lot has happened since 2011, including the main UK Corporation Tax rate falling from 28% to 20%. However, what has not changed is the need for the NI Executive to gain control of key economic powers which would allow it to make local choices and exert much greater influence over the local economy in order to gain improved economic competitiveness.”
EAG also recognised that Corporation Tax by itself would not be sufficient to deliver the high-value economy outlined in the NI Economic Strategy. Dame Barker added, “Whilst reducing Corporation Tax can be a stimulus for investment and economic prosperity, other wider measures will also be needed to complement this. EAG will expect to play a key role in identifying and influencing these areas going forward.
“Work is already underway to develop a tailored competitiveness report for Northern Ireland, scheduled to be launched in 2015, and an updated survey on SME Access to Finance is also being carried out.”