Don't let corporation tax in Northern Ireland be bogged down by welfare reform
A leading campaigner for a cut in corporation tax for Northern Ireland has called on politicians to detach the issue from welfare reform.
Legislation to introduce lower corporation tax here has received royal assent, but its introduction is dependent upon full implementation of the Stormont House Agreement, including a Budget, and welfare reform.
Those in favour of a cut in corporation tax for the province have said it will create tens of thousands of jobs by making Northern Ireland more attractive to foreign direct investors.
The province shares the UK-wide rate of 20% - but a long-running campaign has called for the rate to be brought in line with the Republic's 12.5% rate. By 2020, the UK's main rate will be brought down to 18%.
It's believed that the Republic's lower rate has enabled it to entice inward investors like Facebook, Google and PayPal to set up substantial operations.
Eamonn Donaghy, who leads lobby group Grow NI and is head of tax at KPMG, said politicians and the electorate were wrong to "fixate" on welfare reform as the biggest issue facing the province.
"Whilst no-one would wish to belittle its importance, the welfare reform issue will not resolve our long term economic situation.
"Our economy needs a stronger private sector. Our young people need the prospect of well-paid sustainable long term employment.
"Our economy needs to be rebalanced. The failure to implement a low rate of corporation tax will severely dent the future growth of our economy."
Mr Donaghy renewed his campaign for a lower rate of corporation tax in Northern Ireland as one of the province's biggest inward investors merged with a Finnish company - and is set to move its headquarters from the US to Finland, to take advantage of its lower corporation tax.
Finland has corporation tax of 20%, compared to the US rate of 35%.
Terex - which took over Co Tyrone company Powerscreen and is based in Kentucky - has reached an all-stock deal with crane manufacturer Konecranes, creating a company with combined annual revenues of $10bn.
Terex CEO Ron DeFeo said: "This merger brings together two great businesses and through synergies provides another lever that is within our control to deliver value-creation to both the shareholders of Terex and Konecranes.
"We have a deep respect for Konecranes and look forward to joining forces with them to build a stronger and more diverse company that will be in an excellent position to succeed in a dynamic and highly competitive global industry." Powerscreen designs and manufactures mobile crushing, screening and washing equipment and is one of the group's four main product lines which also include Terex Finlay, Terex Mineral Processing Systems and Terex Washing Systems. Damian Power, a director at Terex in Omagh, said the merger would have little effect on its operations in the county, where it employs up to 1,500 people. Terex in Northern Ireland has two main facilities, one employing around 600 in Dungannon and another in Omagh, as well as a global business finance and accounting centre in Dungannon. It is soon to open a new parts warehouse at Granville Industrial Estate outside Dungannon.