Businesses make fresh calls for cut in tax rate
A lobby group made up of 20 business organisations from all sectors in Northern Ireland has again urged politicians to get behind dropping the rate of corporation tax.
GROW NI has written to all 108 members of the Assembly claiming that reducing the rate in Northern Ireland will lead to investment and is a price worth paying.
The move came days after Finance Minister Sammy Wilson said a reduction was unlikely during the current Assembly term.
A Treasury paper, "Rebalancing the Northern Ireland Economy" - which explored the possibility of the Assembly being given tax-setting powers - was opened for consultation earlier this year.
The deadline for the consultation, which opened in March, was put back twice from the initial closing date on June 24 to July 1 and then July 8.
It is understood that there were around 700 responses to the document.
Supporters claim cutting the tax from the UK rate of 26% closer to the Republic's 12.5% would boost foreign direct investment, create jobs, encourage more companies to incorporate and would offset looming budget costs.
However opponents claim that the cost to the public purse could hit £450m with no real results and is too much of a gamble.
In the briefing document, GROW NI spokesman Eamonn Donaghy says that any reduction in the block grant to Northern Ireland is not a 'sunk cost' but 'an investment in our economic future.'
"It is widely accepted that a reduced tax has the potential to lead to the creation of tens of thousands of jobs over the next decade," he said.
"However because the EU require an upfront cost, and the current best guess estimate appears to be more readily quantifiable, that has received disproportionate attention. Increased investment means more employment and a rise in the overall tax and National insurance paid by individuals. This additional revenue should be capable of being offset against the corporation tax losses. In fact based on the Treasury's own estimates, the net loss could be as little as £145m. While this is a significant sum it is dwarfed by the annual sum under the control of the Executive which is £10.5bn, and that figure does not include social security payments or committed capital expenditure.
"Northern Ireland needs a critical economic intervention in order to truly re balance our economy. This option carries a cost, but it is well worth paying."