Posted on Wednesday 3 December 2014 by Ulster Business

Corporation tax devolved provided stormont behalves

Pressure has been heaped on Northern Ireland’s political leadership after Westminster said it will devolve corporation tax-setting powers to Stormont providing the Executive can prove it is able to work together to “manage the financial implications”.

The Chancellor fired a warning shot across the bows of the Stormont Executive during the autumn budget by warning ministers they need to prove they can work together before business tax can be devolved.

His comments come after prolonged deadlock in talks at Stormont around flags and parades, as well as a costly failure to implement welfare reform cuts here.

George Osborne progress in those talks will pave the way for the devolvement of corporation tax-setting powers.

“The current talks will see if that's the case,” he said. “And if it is, the government will introduce legislation in this parliament."

The umbrella body of business organisations which has been campaigning for devolved corporation tax took the announcement as good news but said political leaders here need to take responsibility for ensuring it is implemented.

"Today’s announcement means that the UK government wholeheartedly supports Northern Ireland being able to set its own corporation tax rate,” Eamonn Donaghy, Grow NI said. “The argument for devolution of this power has now been accepted by all the main UK and Northern Ireland parties so it is up to our leaders here to ensure that this important economic lever is delivered.”

Kevin Kingston, President of the Northern Ireland Chamber of Commerce, left the Executive in no doubt about the work it has to do in the coming months.

“With the powers now sitting firmly in our hands, our politicians must grasp this opportunity whilst using the two years prior to the implementation of the new tax rate to ensure that we maximise the opportunity,” he said. Also, whilst agreeing the budget, the Northern Ireland Executive must ensure that resources are in place to support marketing, skills and infrastructure development.”

The Institute of Directors also pointed to Stormont for leadership.

“We would urge all parties currently involved in talks to show leadership in pursuit of a goal which already has cross-party support,” Linda Brown, Director of the Institute of Directors Northern Ireland said.

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