Jeff Peel's Diary

Stormont: Image by lyng883 via Flickr

Sammy Wilson, our perma-tanned Finance Minister, has just made the point on BBC Spotlight that if the the cost of a reduction in corporation tax is a £500m reduction in the the block grant he, and his Assembly colleagues, would say ‘no’ to such a reduction in corporation tax.

This neatly sums-up the sheer lack of any strategic vision on the part of the Finance Minister and his Assembly colleagues.

Regional tax differentials are an extraordinarily handy way to rebalance regional economic inequities. If the Treasury offers Northern Ireland the tantalising prospect of a reduction in corporation tax the Assembly should grasp the opportunity with both hands.

Northern Ireland’s costs of doing business are substantially lower than the Republic of Ireland’s. We have better infrastructure. We have more ready access to the UK economy and markets. And we have very useful clusters of businesses – especially in ICT. A reduction of corporation tax to the same level as the Repeublic of Ireland would be a strategic move in the right direction to putting the Northern Ireland economy at significant competitive advantage over other parts of the UK – including the South East of England.

To forego the opportunity to create huge economic competitive advantage for indigenous business growth and FDI on some aburd point of principle would be foolish in the extreme and Sammy Wilson is crazy and blinkered to suggest he would look this gift horse in the mouth.

The Assembly needs to wise-up on this issue. The prize of a reduction in corporation tax is a huge one. Don’t mess it up.

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