NI corporation tax rate cut out until after Scottish independence vote, says Cameron

Robinson and McGuinness say decision could be taken immediately 'if there was political will’

No decision on Northern Ireland’s demand to set its own corporation tax will be made until after the Scottish referendum is held, British prime minister  David Cameron has said. Photograph: Danny Lawson/PA Wire

No decision on Northern Ireland’s demand to set its own corporation tax will be made until after the Scottish referendum is held, British prime minister David Cameron has said. Photograph: Danny Lawson/PA Wire

 

British prime minister David Cameron said yesterday that no decision on Northern Ireland ’s demand to set its own corporation tax will be made until after the Scottish referendum is held in 18 months’ time.

The news was greeted with disappointment, even anger by the Northern Ireland First Minister Peter Robinson and Deputy First Minister Martin McGuinness during a meeting with Mr Cameron in No 10 Downing Street.

“This meeting made it absolutely clear that there will be no decision on corporation tax to our Executive this side of a Scottish referendum,” said Mr McGuinness.

The prime minister fears that tax concessions now to NI could force him to detail the extra powers for the Scots if a majority there vote against independence in September 2014.

“We can’t understand that reasoning because we think it sends the wrong message to Scotland. Effectively, you are saying to the people of Scotland that if you want more fiscal autonomy then . . . the only way to have it is through independence.”

NI’s campaign for a 12.5 per cent corporation tax rate – to match the Republic’s – has been under way for more three years and was supported by the Tories during their time on the opposition benches.

The treasury has been opposed throughout, believing different rates in the UK would create myriad difficulties – particularly leaving open the possibility of abuse by companies operating in different regions.

Equally, if a tax cut was successful in attracting significant investment to the North then it would intensify mounting irritation among some voters in England that they are suffering discrimination..

“I have to be concerned . . . as to whether the treasury are playing a more negative role than they were playing two years ago,” said Mr McGuinness. He added that the target now is to win concessions between the referendum and the May 2015 British general election.

NI Chamber of Commerce president Mark Nodder said the North’s economic future is being put on hold. “The challenge will be ensuring that this is resolved before the next general election.”