CREDIT where credit is due. We are always quick to criticise the fiddly micro-measures so beloved by the Treasury, mere baby steps that do nothing to boost the competitiveness of UK Plc.
But when it comes to corporation tax, the coalition has made great strides.
By 2015-16, the exchequer will collect some £2bn less in tax from UK Plc, according to Treasury estimates, once you add the effect of corporation tax cuts to plans to reform the much-hated regime that governs foreign profits (CFC).
It is debatable how much of that has been chipped away by other taxes, such as higher national insurance contributions, or by the ever growing burden of red tape. But what is effectively a £2bn tax cut should not be sniffed at.
The Treasury doesn’t believe in dynamic forecasting, but we think the changes to corporation tax and CFCs will boost economic activity and government revenues.
Firms who were considering leaving the Britain will now seriously consider staying; those who have left might return; and some foreign ones could even choose to call the UK home.
WPP, the media giant whom the policy was essentially designed for, still has its concerns, as we reveal on page one, but the Treasury is keen to address these.
George Osborne has linked the success of the policy so publicly to the return of one multinational that failure is not an option.
The decision to reform the CFC regime to lure WPP back to British shores might have been good politics – but it was good economics too.