Business leaders have warned that corporation tax powers cannot be allowed to flounder because of a lack of political agreement.
fter five years of intense lobbying, Chancellor George Osborne yesterday agreed to devolve the tax power - but only after the successful outcome of the current political talks.
Mr Osborne put the ball in the Executive's court by saying it must show it can cope with the full financial implications before he hands Stormont the power to cut the taxes businesses pay on profits.
While the Chancellor did not spell out his conditions explicitly, it is being interpreted as striking a budget deal and agreeing welfare reform. He told the Commons in his Autumn Statement: "The Treasury believes it can be implemented provided the Northern Ireland Executive can show it is able to manage the financial implications.
"The current talks will see if that's the case and, if it is, the Government will introduce legislation in this parliament."
But doubts were already beginning to emerge last night over the possibility of political agreement after Sinn Fein said it would not agree to the transfer of corporation tax "on the basis of implementing Tory policies". It attacked the "breathtaking arrogance" of the Chancellor and lambasted him for presiding over "Dickensian levels" of spending cuts and austerity.
However, business leaders have warned politicians not to miss out on the opportunity to kickstart an economic revival.
Eamonn Donaghy, a tax advisor at KPMG, said: "There is going to be a democratic process involving the parties but if they cannot implement this there will be a lot of unhappy people in business."
Kevin Kingston, the president of the Northern Ireland Chamber of Commerce and Industry, said: "The outcome is now placed firmly on the Northern Ireland Executive's willingness to co-operate on a number of issues which have challenged them.
"Our politicians must grasp this opportunity whilst using the two years prior to the implementation of the new tax rate to ensure that we maximise the opportunity." Ben Collins of the Royal Institute of Chartered Surveyors construction body said: "The onus is now on the Executive to demonstrate that it can make progress on key issues like welfare reform."
Many believe that allowing Northern Ireland to lower its corporation tax rate will enable it to compete more effectively for foreign investment against the Republic, where the rate is just 12.5%, compated with 21% in the UK.
DUP leader Peter Robinson said that the other Executive parties were to blame for the conditions being imposed to secure corporation tax powers.
His Finance Minister Simon Hamilton said those parties must now step up to the mark. "Those parties like Sinn Fein and the SDLP, who have dragged their feet on welfare reform, have to stand up, step forward and show leadership in respect of budget and welfare reform issues," he said.
"My party has shown leadership and maturity in respect of welfare issues, by putting suggested ways forward on how to negate the worse effects of welfare reform in Northern Ireland."
Mr Hamilton said even if the talks were to be resolved quickly, it would still be years before the lower rate was introduced. After that, it would likely match the Republic's 12.5% rate.
Secretary of State Theresa Villiers said: "It has taken a significant effort to get to this point and it is positive news that Northern Ireland could be on the brink of getting these powers.
"Today's Autumn Statement has raised the stakes in the cross-party talks and made it even more vital that the parties do all they can to reach an agreement in the short time we now have," she added. "It is vital not to let this opportunity slip away."