30/05/2012

Reducing Corporation Tax Could 'Transform' Economy

Lowering corporation tax for Northern Ireland would "transform" the economy, according to a former secretary of state.

The Right Honourable Lord John Reid of Cardowen called for decision-making powers on corporation tax – which currently stands at 24% - to be devolved to the Northern Assembly.

Speaking to an audience of including insolvency professionals, Lord Reid said that Northern Ireland had good education and highly competitive costs, but lower corporation tax would boost the economy.

He said: "Northern Ireland is still lagging behind the rest of the UK in terms of economic recovery – due in part to the significant property boom and bust, and our exposure to the difficulties within the Republic of Ireland economy. We have high unemployment and deprivation, we have high dependence on the public sector and, of course, we have an economy which has emerged from a troubled past. However, if there’s any area in Europe that has shown itself capable of radical change, it is Northern Ireland, and that’s why I am a supporter of devolving control over taxation to the Assembly here. A lower rate of corporation tax will help transform the economy through encouraging enterprise and reducing our dependency."

Lord Reid went on to tell the annual R3 dinner, held at Titanic Belfast, that lower corporation tax could bring foreign direct investment, employment and research and development investment in its wake.

Lord Reid was Secretary of State for Northern Ireland from January 2001 until the suspension of the Assembly in October 2002.

(NE)

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