Quadriga Quizzes Chancellor
By Jeffrey Peel – At the CBI Conference in London a couple of weeks ago, I got the opportunity to ask the Chancellor about his plans to introduce lower corporation tax rates in the regions.
This is a subject that interests me, of course, because I pay corporation tax and my business is based in a region with vast public sector dependency and a relatively stunted commercial sector. It always seems to be a particularly nasty tax to business-people. After all, we take risk, set up our own businesses with our own money, pay income tax on our earnings, and then have to pay tax on any profit we make. In this respect it really works against enterprise and risk-taking. It also stifles investment.
Anyway, the question I asked is one that will interest business people in the so-called “less advantaged” UK regions such as Scotland, Northern Ireland and Wales.
I asked if Mr Darling had any plans to introduce a lower, preferential, rate for these regions. He said no…in a politician’s usual, roundabout, way. As for Northern Ireland, he made clear that the issue of tax was being considered by Sir David Varney – and we’re all awaiting his report (if not with bated breath).
However, the Chancellor’s answer was laden with negativity – he hinted heavily that a special corporation tax rate for NI would work against other UK regions and would be very tricky to administer.
I tend to agree – despite the fact Northern Ireland shares a land border with a country with a much lower CT rate.
The answer begs another question though…which is when will corporation tax in the UK be reduced to the same level as RoI? Because that, rather than fiddling with regional CT rates, is what we need – right across the whole of the UK.
