Chartered Accountants Ireland (CAI) and its Ulster Society held talks with Northern Ireland (NI) business organisations on a proposal to cut the region’s corporation tax rate.

The meeting brought together representatives from the NI Chamber of Commerce and the Confederation of British Industry Northern Ireland to explore how a lower rate might be introduced and its broader economic impact.

The groups agreed to back efforts to reduce the corporation tax rate in NI.

They also agreed that NI needs “a coherent, long-term industrial policy” to draw investment, support jobs and encourage innovation.

CAI and business bodies also discussed the need for a detailed economic assessment on how a cut in corporate tax rate could influence employment, earnings and investment.

During the discussions, participants referred to the 2021 ESRI study entitled Enhancing Attractiveness of the Island of Ireland to High-Value Foreign Direct Investment.

That research suggests that reducing the corporate tax rate to 15% could deliver a 7.5% annual increase in foreign direct investment in Northern Ireland.

One of the main outstanding issues highlighted at the meeting was the possible impact on the annual block grant that NI receives.

The institute outlined a range of options to deal with this, including the use of a low interest loan from Westminster to cover the initial decline in corporate tax revenues following a rate reduction.

Those present described the talks as an important step towards a coordinated position among NI’s business community on the proposal.

“Work will continue to garner cross-party consensus on reducing the corporate tax rate in Northern Ireland, which will be critical when the campaign is taken to Westminster,” CAI said in a statement.