Cut in corporation tax 'vital to boost economy'
Published 29/11/2006 | 00:00
A cut in corporation tax has been rated by Northern Ireland's accountants as the number one driver in kick-starting the local economy.
The finding was made in a snapshot survey carried out by the Ulster Society of Chartered Accountants.
The research was commissioned following the recent report by the Economic Research Institute of Northern Ireland which highlighted the potential benefits.
That report, commissioned by the Industrial Task Force, suggested that a cut in the corporation tax level from 30% to 12.5% could spark the creation of 180,000 new jobs by 2030.
The USCA survey showed that 88% of respondents thought a tax rate cut would be either essential or "very useful" in boosting the province's economy.
But 67% of those who took part in the survey stressed that a cut in corporation tax was not a "silver bullet" which could on its own transform the economy.
Indeed, only 11% of the 100 accountants who responded to the survey said that a cut in corporation tax alone would be sufficient to make Northern Ireland's economy more competitive.
A further 22% said they felt other economic initiatives such as encouragement of skills development and innovation, would be more beneficial.
Colin Johnston, chairman of the 2,700 strong USCA, said he felt the feedback was a fair representation of the feelings of the local business community.
He added: "The clear message from this survey is that while many in the business community view a possible cut in the corporation tax rate as highly desirable, or even essential to secure a competitive economy, it is not enough on its own.
"Clearly the issue of a regional corporation tax cut is proving difficult in the framework of a UK tax regime.
"We believe the rate should be cut for the whole of the UK, thereby improving our competitiveness with the Republic without putting regions in Britain at a disadvantage."
Mr Johnston said the prospect of agreement on reinstating the Assembly was very positive from an economic point of view.
He said it was vital that a package of measures was put together which could help Northern Ireland build towards a sustainable and globally competitive economy.
Mr Johnston, who heads the Clear Healthcare Group, said a strong economy would benefit many areas of local life ranging from housing to health and education.