Most people in Northern Ireland don’t want to pay for the devolution of corporation tax, the Belfast Telegraph LucidTalk poll has revealed.
This is despite the fact that the measure is favoured by all the Executive parties and most business leaders here who see it as the key to reviving our economy.
The political consensus for making the cut and bearing some cost, extends to Owen Paterson, the Secretary of State who has championed the idea since taking office.
He recently said: “For me it is very important that we have unity, don’t underestimate that. I can walk into the Cabinet and say, ‘I have complete agreement across the political spectrum.' That is really powerful.”
But the poll figures show consensus does not reach the grassroots. The findings come as British and local ministers prepare for their final meeting to discuss the issue on June 25. They have pledged a decision over the summer.
The proposal split voters who we surveyed more or less evenly between those in favour (30%), those against (34%) and don’t knows (36%) with a majority of those who gave an opinion in the ‘no’ camp. The question put by LucidTalk was carefully chosen to be neutral in tone. Each person surveyed was told that “business opinion states that reducing corporation tax, that is tax on companies, will attract investment and jobs to Northern Ireland”.
They were then asked “would you accept an initial reduction in public spending to pay for this?”
When more than a third of don’t knows were taken out there was a majority of between 51% and 63% in all social, age and religious groups to keep things as they are. Opposition to any reduction in spending to fund the tax cut was highest amongst Catholics who expressed an opinion (63%) though it was also high (57%) amongst private sector workers whose employers might be expected to benefit most from the change.
In Great Britain and Northern Ireland corporation tax on company profits is charged at 20% on profits under £300,000 and 24% after that though the maximum figure will decrease to 23% in 2014. In the Republic it is just 12.5% and that has led to an influx for Foreign Direct Investment, especially from America.
It is argued that a reduction (the DUP want an eventual 10% rate) would build up our economy with foreign firms seeking a foothold in Europe.
This is seen as a way of rebalancing the economy away from our current high dependence on the public sector.
Change comes at a price. Under European law we must levy the tax ourselves and, if we cut it, bear the shortfall out of local revenue. London cannot make up the difference.
The cost of reducing the tax to the Republic’s level has been estimated at £400m a year, though that is still under negotiation.
Proponents argue that so much investment would be attracted in by lower rates that the overall take from corporation tax would eventually increase, allowing Stormont to show a profit in time. This is what happened in the republic when rates were cut.
Last month around 60 Northern Ireland businesses joined the First Minister Peter Robinson to make this case in Westminster.
It seems that they still need to convince the voting public.
For full statistics analysis visit Lucid talk