UK Chancellor George Osborne has pledged to give Northern Ireland the power to set its own corporation tax rate if it can show it can manage the financial implications.

If the power is devolved, it is expected the Northern Ireland Assembly would likely reduce its tax rate to at least match the Republic’s at 12.5pc in a bid to lure more foreign direct investment.

“Today I announce that we recognise the strongly held arguments for devolving corporation tax setting powers to Northern Ireland,” Mr Osborne told the House of Commons in huis autumn economic statement this afternoon.

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“The Treasury believes it can be implemented provided the Northern Ireland executive can show it is able to manage the financial implications. The current talks will see if that’s the case. And if It is, the Government will introduce legislation in this parliament.”

At the moment, corporation tax is levied at a rate of 21pc in the UK, although that will be coming down to 20pc in April.

Online Editors