Northern Ireland could gain control of its corporation tax rate

Delivering his half-year budget statement, Britain’s finance minister George Osborne said they could legislate for the move before next year’s elections, provided assurances were given by NI politicians.

Mr Osborne said this matter could be determined at the ongoing all-party talks being held in Belfast at present.

Northern Ireland’s corporation tax rate is currently tied to the overall 21% rate for Britain.

Politicians have sought the power to change that, however, so that they could compete with the 12.5% rate charged in the Republic. 

The British government had previously resisted such a move, but has since become more open to the devolution of certain taxation measures following the Scottish independence referendum.

Osborne ups British growth forecasts

Meanwhile, Mr Osborne said that Britain's economy would grow at a faster rate than previously expected this year and next.

The UK's gross domestic product is set to grow by 3% in 2014 and by 2.4% in 2015, upgraded from the government's previous forecasts of 2.7% and 2.3%, Osborne told parliament today. 

The Chancellor said forecasts showed Britain was the fastest growing advanced economy in the world and hundreds of thousands of jobs were being generated.

But he confirmed that borrowing was estimated be £91.3 billion this year - rather than the £86.4 billion the Office for Budget Responsibility previously expected.

He stuck to his plan for further spending cuts to put Britain's budget back in the black before the end of the decade, hoping that his purge of the public finances will return him and Prime Minister David Cameron to power in May.

He also announced a fresh crackdown on corporate tax avoidance, saying multinationals which artificially move profits abroad would be hit with a 25% tax and banks would be able to claim fewer tax breaks for losses dating back to the financial crisis. Bank shares fell.

In this, Mr Osborne was taking aim at political ground held by the opposition Labour party, which claims the Conservative-led coalition favours the rich.

Britain finally began to recover from the financial crisis in mid-2013. But growth has not yet brought big pay rises for workers or higher income tax receipts for the government.

Mr Osborne said Britain's deficit would be bigger than previously expected in the current financial year and in 2015/16 before improving after that and going into surplus in