Pressure on Ireland as UK cuts corporate tax

The UK is to cut its corporate tax rate from 20% to 18% by 2020; thus lessening Ireland’s advantage in attracting foreign direct investment. The North is also seeking to get a special rate in the next few years of 12.5%, to match Ireland’s.

British chancellor George Osborne included the measure in his latest budget yesterday. Britain’s corporate tax rate will be cut to 19% in 2017 — from its current 20% level — and then to 18% in 2020. Mr Osborne also said he will maintain the pace at which the UK cuts the budget deficit, as he reduced taxes on banks and other businesses while squeezing welfare.

The chancellor pared a levy on banks and introduced a new surcharge on bank profits, while placing limits on tax relief for so-called non-domiciled people living in Britain.