Belfast Telegraph

Corporation tax poll shows backing for cut - but public spending in Northern Ireland should be slashed to fund it

By John Mulgrew

An overwhelming majority of companies are confident that slashing Northern Ireland's corporation tax rate will have a positive effect on their businesses, a straw poll has revealed.

Dozens of firms were quizzed as they packed into a detailed seminar on the minutiae of the new Bill, which will see corporation tax powers handed over to Stormont in 2017.

And around 80% believe any cut to Northern Ireland's block grant - which could be as much as £350m - should come out of a reduction in public spending.

It also showed more than 80% of firms believed a cut would have a positive impact on their businesses.

And the live sample poll showed almost three-quarters of those quizzed - which included businesses from manufacturing, construction and finance - would inject any extra cash gained as a result of the drop back into investment in their companies.

The briefing, held by tax experts EY at the Ulster Hall in Belfast, tried to put some meat on the bones over what the changes would mean for firms here.

Professor Neil Gibson, director of Ulster University's Economic Policy Centre, said it was both a "good news day" and "very important time" for Northern Ireland's businesses.

"We can't say what the effect will be, but we have to know that this is one of the most critical negotiations Northern Ireland has ever had," he said.

But he also predicted short-term job losses following the initial dropping of the rate, before witnessing economic growth of 11% over the next two decades.

The levy powers could be in the hands of Stormont by April 2017, allowing Northern Ireland the chance to lower the business rate to bring it closer in line with that in the Republic.

And half of those polled were in favour of a 10% rate for corporation tax.

Companies on the whole appeared to glean a clearer insight as to how their businesses could benefit from a proposed cut.

Small and medium firms will be eligible for the Northern Ireland rate on an 'in or out' basis - dependant on turnover, employment numbers and where staff operate.

Mash Direct's Gary Armstrong said a reduction would allow the company to invest in growth and create new jobs.

Dermott Brooks of hotel group Andras House, which is owned by Lord Rana, said the rate was an opportunity to "generate surplus cash for investment".

Meanwhile, some 42% of the dozens of business leaders said a lack of skills and training were the biggest obstacles facing firms in Northern Ireland.

Belfast Telegraph