A LEADING think-tank has raised concerns about SNP plans to slash corporation tax if Scotland becomes independent.
The Scottish Council for Development and Industry said its members – drawn from business, academia, public sector bodies, charities and trade unions – felt "no great desire to participate in a race to the lowest tax environment".
Following a major survey of members, it also warned that an independent Scotland would lose influence over its monetary policy if it forged a sterlingzone with the UK, and raised fears over the terms of the country's EU membership.
It said there was a "clear appetite" for more information on economic aspects of the independence debate.
But it also said the referendum must not be allowed to distract from efforts to boosts jobs or to use the economy as a "football".
The findings emerged in Future Scotland – Discussions and Priorities, a report based on feedback from nearly 200 of the SCDI's 1200 member organisations. It said some bodies declined to take part because of "sensitivities" over sharing their views on independence.
On the SNP's plan to cut corporation tax to 3p below the UK rate – potentially producing a 17% rate in an independent Scotland as the UK moves to 20% from 2015 – the report said: "It was not a priority for most respondents that Scotland is able to lower its rate below that of the rest of the UK."
It said a significant cross border rate gap "could" help attract investment to Scotland but questioned whether such tax competition would be allowed by the EU.
It also warned the SNP had "missed the boat" if it hoped to create an ultra-low tax regime like Ireland, where corporation tax is 12.5%.
The report said a "very clear majority" agreed with the SNP that an independent Scotland should retain sterling in a currency union with the UK. But it added: "Numerous respondents voiced reservations about how well an independent Scotland would fare in negotiations post-referendum."
Chief Secretary to the Treasuiry Danny Alexander welcomed the findings on corporation tax. He said: "The Coalition Government is committed to making Scotland open for business which is why corporation tax will be cut to 20% by 2015.
"Our policy is... already making the UK one of the most attractive investment locations in the world."
Finance Secretary John Swinney said: "I welcome SCDI support for the Scottish Government's proposal for a formal Sterling area with a shared currency."
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