Corporation consensus will create tax haven for fly-by-nights: Trades Council

Secretary of Derry Trades Council Liam Gallagher says the consensus view that the Northern Ireland corporation tax rate should be reduced to 12.5 per cent in line with the Republic of Ireland will simply create a tax haven for "fly-by-night" companies with no interest in remaining here for the long haul.

He said it was incredible that each of the mainstream political parties here were lining up behind this policy.

"It is hard to believe that our Northern Ireland politicians in Sinn Fin, SDLP, Alliance, DUP and Unionists are proposing setting N. Ireland up as another tax haven by reducing corporation tax to 12.5 per cent in line with the Republic," said Mr Gallagher.

"All that this will do is to encourage fly-by-night companies that have no intention of creating sustainable jobs and whose only aim will be to off load profits in the province before moving them as quickly as possible to another off shore tax haven.

"Surely our politicians should have learnt a lesson from the experience of the Republic which built their economy on the bases of corporation rate competition and ended up now virtually bankrupt."

He said that making the same low tax mistakes as witnessed in the Republic of Ireland was not the solution to achieving greater economic growth in Northern Ireland.

"Copying the culture and failed policies of the Republic is not the solution to growing the private sector in N.Ireland with sustainable growth," he said.

"Anyway what is the sense of reducing corporation tax when to do so under E.U. rules which states that cut-rate tax deals are only allowed on condition that any public subsidy has to be reduced to match the loss in revenue, pound for pound.

"There is no evidence that reduced tax rates would result in a penny more being raised to sustain the public sector.

"The result on an already low tax base would spell disaster for the public sector here," he continued.

The Trade Union representative also accused the newly-established Conservative-Liberal Democrat Government of preparing to launch a "massive attack" on the poorest people in society with an 80 per cent cut/20 per cent tax policy.

"We are being currently softened up by the Cameron Government with the help of the Tory press in order to launch a massive attack on the most deprived people and areas in our society," he warned.

"The 80 per cent cuts and 20 per cent tax philosophy ignores the fact that we are in this mess because politicians allowed the free movement of labour and capital to feed the insatiable greed of the short term profit merchants.

"The whole concept of a fair cohesive society is predicated on strong public services paid for by a fair taxation system based on the ability to pay.

"Last year in Britain 123 billion pounds was lost in unpaid tax revenue due to non compliance, tax fraud and elaborate non payment loop holes.

"Add to that fact the massive public pay out to bail out banks and you begin to understand what the real debate should be."