With the vote to determine whether Scotland should remain as part of the United Kingdom looming, we take a look at what the result could mean for businesses in Northern Ireland.
This is a question that will be on the minds of many local businesses as we approach the 18th September. If the vote for Scottish independence is a ‘no’ then it should be ‘business as usual’ for your company. However, a ‘yes’ vote could certainly impact Northern Ireland firms which are currently doing business with Scotland and, although we don’t fully know the extent of the likely impact at this stage, there are a number of factors that we should consider.
An independent Scotland could mean that Northern Ireland businesses would find themselves dealing with a separate regulatory regime, potentially requiring increased regulation and compliance. There will also be two different tax systems, and with the potential for a different currency to be brought into the equation as well, doing business with Scotland could become more complicated. Risk assessments need to be taken as to whether it is appropriate to establish an operational base in Scotland. Logistics will also need to be considered both in relation to transporting goods from Northern Ireland to Scotland and transiting goods through Scotland to England.
On the other hand, an independent Scotland could also bring about opportunities for Northern Ireland. Some English or Welsh businesses wishing to keep trade within the UK may prefer to trade with Northern Ireland as the next closest UK jurisdiction and vice versa.
A ‘yes’ vote could also have implications for our corporation tax debate for Northern Ireland. In the eventuality of Scottish Independence coming into play, the Scottish National Party [SNP] has stated its intent to cut corporation tax and there is every chance that Scotland could get there before Northern Ireland. This would leave Northern Ireland surrounded by two countries with a lower rate of corporation tax, which could certainly impact negatively both on our competitiveness to attract foreign direct investment and on any rate change by the assembly in the future.
For now, though, it’s very much a game of ‘wait and see’. All eyes will very much be on 18th September and the weeks and months which follow.