#SluggerReport: UK Corporation Tax to drop 5%, so where does that leave NI PLC?

In the Slugger report this morning, I agree with Wolfgang Munchau that it is time for the UK to pursue its options, not to cry over split milk of the Referendum, or worse, look for a re-match. Whatever damage has been done (and we won’t know that for a while) it’s time to move on.

It is, of course, sobering to recall that the UK government has slapped a requirement on Unions to get 40% support of the unions membership before any action can take place (the EURef got 37.4%). As Rick notes, you couldn’t even organise an overtime ban for that much.

But in terms of a Brexit, it’s largely beside the immediate point. From an NI point of view we are likely to have some influence on how Brexit pans out, but it is likely to be limited.

Osborne’s announcement that he intends to cut Corporation Tax to within 2.5 points of the Irish rates kinda shoots one of the few distinct fiscal policies for reflating the NI economy. Moreover, we may get squeezed as the Republic pushes back.

As IBEC’s chief executive Danny McCoy notes:

“We need to slash capital gains tax, cut the marginal tax rate to attract mobile talent and bring the tax treatment of share options into line with the UK and other competitor economies. Now is not the time to sit on the sidelines and see what happens.”

And that’s not including any fierce response from Osborne (or his Tory successor) in terms of cutting public spending to compensate for the transition to a new leaner meaner UK model that may be needed to exploit new opportunities coming up.