Corporation tax cut 'totally unattractive'

The momentum for a cut in the Northern Ireland corporation tax rate took a large blow when Secretary of State, Owen Paterson, told MPs that such a move could mean a £310million cut in the block grant from Westminster.

After the secretary of state's speech to the Northern Ireland Grand Committee Sammy Wilson said that cut in corporation tax would be "totally unattractive" if it resulted in such a large cut to the block grant, which would leave the assembly to deal with a large budget shortfall.

A consultation paper on the matter is expected shortly from the secretary of state, but even if the assembly were granted powers to vary corporation tax, it might be less likely to make cuts at the rates previously mentioned in light of the consequential cut in the block grant.

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