Could Scotland independence affect NI corporation tax plans

Finance Minister for Northern Ireland, Sammy Wilson, feels that Westminster concerns over Scottish independence could bar the way to a positive outcome on devolving tax powers to the Northern Ireland Assembly.

The UK government are due to make a decision on whether to grant the power to deal with corporation tax rates to Northern Ireland, and Secretary of State Owen Paterson says they will make their decision by summer this year, and denied that there was any link between the debate over Scottish devolution and whether to allow Stormont to deal with corporation tax.

A lot of emphasis was made prior to the talks with the UK government about the potential investment that could be brought to Northern Ireland if the rate of corporation tax was reduced to rival the much lower rate in the Republic of Ireland, however their will also be a cost in lost tax to the UK government which will have to be offset against the annual block grant. Sammy Wilson has suggested that Northern Ireland could lose as much as £500million of the Westminster block grant each year as compensation to the UK government for lost revenue. That is the one of the highest estimates so far, and will certainly be a factor when it is decided if the cost of devolved tax power can be justified.

If you require legal advice in respect of a business matter in Northern Ireland contact one of the commercial solicitors at Wilson Nesbitt by calling 0800 840 9295.