Stephen Farry stated:
“Despite the progress of recent years, the Northern Ireland economy, as currently orientated, is unsustainable. While Northern Ireland has seen some better rates of growth since the early 1990s, the economy remains unhealthily dependent upon the public sector. Simply, the private sector is too small.
“Alliance strongly believes that the Treasury should consider giving the Northern Ireland Assembly the powers to vary the rate of Corporation Tax. This fiscal measure would be the single most effective means of changing the Northern Ireland economy.
“Rather than perpetuating a situation whereby Northern Ireland and indeed other regions of the United Kingdom continue to be dependent upon considerable levels of public subsidy, there is a strong argument for granting Northern Ireland greater fiscal autonomy and creating the ability to make its economy more sustainable. In turn, this should increase the size of the local tax base in the medium term and return the fiscal subvention to the UK Treasury.
“A differential rate of corporation tax by itself would not generate the radical changes needed to boost the economy. It must be regarded as the central element in a cocktail of measures, including addressing the opportunity costs that arise from a segregated society.
“However, it is the one piece of the jigsaw where the power of control lies outside the control of the Northern Ireland Assembly.
“The other supply side reforms can and must be implemented in conjunction with any lower rate of corporation tax. Indeed, there is a strong case for the Treasury seeking to ensure that such reforms do indeed take place as the quid pro quo of movement on corporation tax.”
ENDS