NI accountants plea for corporation tax cut

The importance to Northern Ireland of securing a reduction in the rate of corporation tax from Chancellor Gordon Brown was spelt…

The importance to Northern Ireland of securing a reduction in the rate of corporation tax from Chancellor Gordon Brown was spelt out to the First Minister.

The Rev Ian Paisley has yet to conclude an economic package from the Government to give the new Executive a sound financial footing.

When he opened the new office of the Institute of Chartered Accountants in Belfast they stressed to him how important they consider a tax cut to the 12.5 per cent charged in the Irish Republic could be to kick-starting the local economy.

Jim Aiken, vice-president of the ICAI, said reducing the tax rate would be good for both sides of the border.

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"To be truly successful in the international market, this island economy must display a united front to the world.

"By acting as closely as we can, both territories will surely benefit."

He said that in calling for a tax reduction in Northern Ireland "it is often overlooked that the 12.5 per cent rate in the Republic of Ireland is focused on trade, and trade only — other company activities attract rates equivalent to the European average."

And he predicted: "A unified front on the taxation of trading activities on the island of Ireland will attract investment from abroad, and support all island markets to the direct benefit of both economies.

"We also believe that a corporation tax rate in the north which is in line with the south will encourage investment from south to north as well as north to south."

Such a move, he said, was not a tax competition, it was a kind of tax facilitation which removed tax barriers.

"In any competition there are winners and losers. Reducing the corporation tax rate in the north to bring it in line with the south will only create winners," said Mr Aiken.

The Institute's call came on the eve of its annual conference which will bring over 500 delegates to Belfast over the next two days from all over Ireland.