Give mayors ability to cut income tax and business rates, Jake Berry suggests

Speaking at the Convention of the North event in Liverpool, the Tory MP for Rossendale and Darwen and chair of the Northern Research Group of Conservatives suggested allowing mayoral combined authorities to set their own tax rates could make regions more competitive.

Mr Berry said while the idea was not one included in last week’s Levelling Up White Paper, it is one that he believes merits serious consideration.

“I think one of the really interesting ideas I would like to see come out of the devolution revolution is look at how mayoral combined authorities get some slack on taxation rates to make their area more attractive,” he told a panel session at the event.

“If you gave those CAs the ability to independently vary down business rates or vary down income tax to enable them to make their area more competitive, I think you would then enter into a really interesting space where we could create the North as the most competitive place in the United Kingdom to start and grow a business.

“There is quite good evidence in the United States of America where they have tax competition between states, there is very good evidence actually in Australia, where they also have tax competition.

“There are global examples that we should seek to follow.

“It is my view that if you have a lower tax, more competitive, less bureaucratic economy enterprise will flourish. You can look around the globe to see that.”

The former minister’s remarks follow a similar suggestion by Tees Valley mayor Ben Houchen earlier this week, who called for powers on setting business rates to be devolved.

Mr Berry noted that a key part of the Levelling Up White Paper was to increase foreign investment in the North and he praised the work already being done by the Labour mayors of Liverpool and Manchester.

“If we truly want to level up the North of England we need to ape what Steve Rotheram and Andy Burnham are already doing by bringing more private investment into the North of England,” he said.

Last week, Levelling Up Secretary Michael Gove said “many of the best ideas in the White Paper are the fruit of work” that Mr Berry and the Northern Research Group of Conservative MPs have conducted.

Mr Berry said he was pleased with the recognition and hopes the strategy of the White Paper will ultimately lead to greater business investment in the North.

“I want to hear the whoosh past my ears as I’m on the M6 as the money flashes up the motorway and lands in the North,” he said. “What gives us great hope is that here in the North of England, we have had a couple of decades of collaborative working. We already have the architecture to deliver this programme for Government.”

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