The Ulster Society of Chartered Accountants (USCA) has called on Chancellor Gordon Brown to present a Budget which delivers regional incentives to stimulate the local economy.

The Ulster Society, which represents over 2,200 members across practice, industry and the public sector in Northern Ireland, said that St Patrick’s Day would be a good time for Mr Brown to recognise the need for tailor-made fiscal policies aimed at boosting the regional economy.

John Hannaway, Chairman of the Ulster Society, said: “Government has a crucial role to play in stimulating a wealth creation culture. What the Northern Ireland economy needs is a period of reduced tax revenues to grow the economy, boost local business and in turn help to underpin political and social stability.”

Mr Hannaway said that the tax breaks recommended to the Government in the Ulster Society’s report 'Fiscal Incentives – A proposal for a step change in the Northern Ireland Economy' in April last year were still very pertinent.

Recommendations from that Report included:

• The designation of Northern Ireland as a “New Investment” zone;
• First year allowances of 100% for capital expenditure by small businesses to be extended to all businesses in Northern Ireland on all types of plant and machinery expenditure;
• Businesses in Northern Ireland to be able to claim enhanced tax allowance on “capability” expenditure such as research and development, product development, marketing and training.

Mr Hannaway said: “It is essential that Northern Ireland creates more economic activity, which requires a significant investment in both capital expenditure terms and ongoing expenditure on product development, research, marketing and training. Lower taxation will motivate business in Northern Ireland to retain funds and will stimulate more investment in these areas, creating a real enterprise culture.

“Unfortunately it looks as though the Chancellor is likely to unveil a Budget which has an unhelpful impact on many local firms. Any change in the treatment of dividends of owner-managed companies could increase the tax bills of the small companies which are the lifeblood of our economy.”

The 'Fiscal Incentives' report has the backing of the CBI Northern Ireland, the Institute of Directors and the Northern Ireland Chamber of Commerce.

(MB)