01/12/2011

A crucial meeting on the Northern Ireland corporation tax rate is set to take place before Christmas, according to Secretary of State Owen Paterson.

The meeting will see ministers from Stormont, led by Martin McGuinness and Peter Robinson, meet with Paterson and other Treasury officials. The meeting is aimed at outlining a possible deal to devolve Northern Ireland's corporation tax powers to Stormont.

NI leaders have been keen to gain the devolved powers, as they will then be allowed to lower their level of corporation tax to be more competitive with the already low rate in the Republic of Ireland.

It is hoped that a lower rate of corporation tax will help to kick start the economy of the region by attracting more foreign businesses to make Northern Ireland their registration jurisdiction.

"We've really got to nail down what this would cost should there be a decision to devolve corporation tax," Patterson explained. "Then, how would it be administered - would there be a separate agency in Northern Ireland? And finally how we would legislate?"

Northern Ireland's current rate of corporation tax stands at 26 per cent - the same as the rest of the UK. Stormont ministers want to bring it down to the 12.5 per cent rate in place in the Republic, or possibly even lower.