Serial entrepreneur and philanthropist, Sir Tom Hunter, is calling for a corporation tax rate of 15 per cent for life sciences and medical technologies and software, big data and AI.
Hunter, who sold first business, Sports Division, 聽for 拢290m, was speaking following the publication of a new report entitled 鈥楲essons from Ireland for Scotland鈥檚 economy鈥�.
The document has been produced by Oxford Economics on behalf of the Hunter Foundation to see what lessons Scotland can learn from Ireland.
Hunter makes a series of suggestions in his forward but the most eye-catching one is calling聽 for a 15 per cent corporation tax.
The corporation tax across the UK, including Scotland, was recently increased from 19 per cent to 25 per cent.
Hunter said: 鈥淗ere鈥檚 my suggestion to Holyrood and Westminster 鈥� make all of Scotland a 15 per cent corporate tax zone for three key global growth sectors: renewables and low carbon manufacture and services; life sciences and medical technologies and software, big data and AI.
鈥淭he Irish experience tells us we will net more tax, more jobs and more value from this highly focussed approach with one agency delivering that approach than we will with our current strategy. And that one agency should deliver domestically and for inward investment.
鈥淎nd as the Ireland Strategic Investment Fund starts to deploy their sovereign wealth fund to support economic growth we need to compete and, in time, grow our own fund.
鈥淭he Innovation Fund of circa 拢100m over 10 years launched a couple of months back is frankly not enough 鈥� R&D funding in Scotland is circa 拢4.5 billion per annum; 拢100m will transform very little indeed.
鈥淏ut we also have a competitive advantage in our universities, something we should double down on aligned to these three key growth sectors.鈥�
Hunter said lower corporation tax drives investment.
鈥淚reland drives foreign direct investment (FDI) with multiple incentives, not least a 12.5 per cent corporation tax rate moving to 15 per cent in 2025,鈥� he said.
鈥淚n 2021 this drove 249 such investments compared to Scotland鈥檚 122. The other key component 鈥� aligning education to economic development; per 1000 of population 39.9 were STEM graduates compared to Scotland鈥檚 20.9.
鈥淔rom 2012-2022 Ireland鈥檚 GDP grew on average 8.9 per cent per annum compared to Scotland鈥檚 rather anaemic 0.9 per cent.
鈥淭hey are home to nine out of the top 10 pharmaceutical companies in the world and 14 of the 15 top MedTech companies.
鈥淎nd recently the Irish government forecast a staggering Euro 65 Billion surplus over the next three years.鈥�
Hunter said the announcement on two new investment zones for Scotland was welcome but 鈥榟ardly jaw dropping鈥�.
鈥淢oreover all of Scotland should be a competitive location not just the Glasgow City Region and the North East of Scotland,鈥� he said.
鈥淚t’s time for a grown-up debate and action over how we make Scotland an economic powerhouse. We need to stop doing those things that don鈥檛 add any value and focus on what delivers otherwise, with a ticking demographic time bomb, we will leave an unbelievably appalling legacy for the next generation of Scots to contend with.
鈥淲e at the Hunter Foundation do not claim to have all the answers but we do believe through constructive debate we will get better answers and outcomes for Scotland.鈥�