NI Corporation Tax 12.5%

chunter

Does anyone of a stable mind and disposition actually believe that reducing corporation tax will bring 30,000 jobs to this country, as certain politicians constantly repeat.

Dublin did this 20 years ago, have many major US companies head-quartered there, with some ropey tax benefits, loads of well trained and experienced staff, etc. - in other words, completely bedded in.

And - By the time this reduction kicks in, the UK could be out of Europe completely.

Some might call it wishful thinking, others may say NI politicians are being disingenuous (surely not) and pushing bad news down the road..

ooo000ooo

Surely reducing the tax to make doing business in NI competitive with other regions will make it more attractive to do business here? Sure the companies will probably use all kinds of fancy accountancy tricks to avoid paying tax but the income tax for all those employees can only be a good thing never mind the reduction in benefits being paid?

tara747

I may be mistaken, but I understand that Westminster will reduce the NI block grant accordingly.

Anyone able to verify this?

Mistral001

Isn't the cost of lowering Capital Gains Tax in NI not going to be financed by Stormont? Unless the money is going to be found from somewhere how can it be done.

Cotta

tara747 wrote: »

I may be mistaken, but I understand that Westminster will reduce the NI block grant accordingly.

Anyone able to verify this?

Yes the block grant goes down by the amount it will cost Westminster in lost revenue due to reduced corporation tax.

tara747

Cotta wrote: »

Yes the block grant goes down by the amount it will cost Westminster in lost revenue due to reduced corporation tax.

Soooo... how much CT will NI have to raise to break even? What if CT revenues are lower than expected, how will that gap be plugged?

Anyone know?

Heisenbug

It won't encourage companies to headquarter here like it has in the South as that has more to do with the Irish laws allowing income to be shifted around corporate structures than the rate of corporation tax. They try to make as little possible profit so the rate doesn't have much impact.

For the same reasons reducing the corporation tax doesn't have much of a impact on employers who have operations here but don't generate a profit locally (eg Allstate, Liberty IT) so isn't encouraging investment from outside which is where a lot of the jobs have been created (and lost) recently.

It will help local businesses but are they really going to create 30,000 new jobs?

motorguy

chunter wrote: »

Does anyone of a stable mind and disposition actually believe that reducing corporation tax will bring 30,000 jobs to this country, as certain politicians constantly repeat.

Dublin did this 20 years ago, have many major US companies head-quartered there, with some ropey tax benefits, loads of well trained and experienced staff, etc. - in other words, completely bedded in.

And - By the time this reduction kicks in, the UK could be out of Europe completely.

Some might call it wishful thinking, others may say NI politicians are being disingenuous (surely not) and pushing bad news down the road..

I guess it makes us more competitive relative to the republic, where they have lower corporation tax.

I know quite a few companies that have established themselves over the border that could / would have otherwise come here.

Good news for me anyway if / when it comes to pass. :beer:

oldhand

I notice tthere will be a number of groups/quangos to be set up so the usual suspects will be to the forefront again to benefit.....

x12yhp

It depends on your view of how business works. If you are talking about a business where the owner wants and easy life and an easy income, this won't help the economy at all. However, that is a mindset mostly that mostly puts a person as an employee, not a business owner. Most business owners are keen to expand and increase. In my case, these changes will free up sufficient funds to employ additional people to help grow. Yes, it gives more money which we could take as dividends but this is increasingly expensive and the money is much better spent expanding the business.

Block grant - yes, we will lose 240M. In our case, there will be an immediate loss of money going to tax but new employees will pay part of this right back and the reason for getting the employees will be to increase turnover which, again, increases tax liability. I am confident that the sums have been done. Even as a micro business, I can see how this can work.

saverbuyer

x12yhp wrote: »

Even as a micro business, I can see how this can work.

See I don't get this.


How as a micro business can this save you enough more to employ extra staff?