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North's tax could fall to 12.5pc

Northern Ireland could see its rate of corporation tax fall to 12.5pc by April 2018 under the political agreement sealed between the British and Irish governments and the Northern Ireland parties yesterday.

Northern Ireland's major parties have campaigned for powers over the rate at which business profits are taxed to be devolved from London to Belfast. The new agreement puts back the target date for cutting the tax by a year.

Legislation has already been passed at Westminster to devolve responsibility to Stormont, but the handover of the power had been delayed by the destabilising political dispute.

Chancellor George Osborne, inset, had said he will only grant it to Northern Ireland when the ministerial Executive's finances are on a firm footing.

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