It comes as no great surprise that Sir David Varney's report on the Northern Ireland economy rejects proposals to lower the rate of corporation tax to 12.5 per cent, bringing it in line with that of the Republic.
But nor should he and the British government be surprised that the North's Finance Minister Peter Robinson said in response: "We will continue to argue the case for a reduction in corporation tax. The issue will not go away". A convincing political consensus in favour of the measure has built up since the powersharing executive was formed. Debate on its merits should continue, taking due account of the case against it.
The report concludes that the UK exchequer would lose nearly £300 million a year in Northern Ireland taxation from the proposal. In the UK as a whole there would be a displacement effect on capital and profits resulting in a net loss of £2.2 billion over 10 years. That would distort UK taxation policy and could run foul of EU law. The report makes a detailed critique of the analytical assumptions underlying the suggested link between lower corporate taxation and foreign investment flows, drawing on international studies. It concludes that this case is not proven at best; other factors such as labour skills, the rule of law, innovation and the quality of infrastructure play equal or more important roles in attracting investment. It follows that Northern Ireland can make economic progress by concentrating on improving these rather than reducing tax.
That Northern Ireland must tackle the economic problems created by 30 years of conflict is not in doubt. Its economy is dominated by the public sector, traditional industries are in decline and high technology ones under-developed, while sectors like tourism have ample scope for expansion, as this report makes clear. Skilled people still leave for employment elsewhere and could be encouraged to return. There is real potential for closer North-South economic co-operation - although the limits imposed by separate development and problems of scale should be recognised. The annual subvention from the UK exchequer runs at some £7 billion.
There is a commitment of substantial funding for economic development from London, to which Dublin has contributed £400 million. And a second report from Sir David Varney on ways to achieve it other than by tax cuts will be available in time for next May's investment conference in Belfast. It is hoped to generate substantial interest from the United States. A unified Irish corporate tax regime would definitely be a major attraction in that endeavour. And Varney notwithstanding, tax incentives play a greater role in kick-starting less developed economies than in sustaining richer, more established ones.
That is why the argument will not go away. It has a wider policy resonance elsewhere as Scottish and Welsh nationalists press the case for more fiscal powers to enable them steer more effective development paths than are currently possible in a devolving UK.