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If we are talking about regional taxation, it is obviously true that there is a different pattern of economic activity within every region. To some extent, the relative success of parts of the south-east Wales corner is a reflection of the pattern of economic activity throughout the whole of the UK. Indeed, south-east Wales is mirroring the greater prosperity of the south-east of England. As I understand it, it is not possible under European competition law to have different tax regimes at a very localised level, other than for local taxation. Of course, it is possible to have regional corporation tax, as is the case in the Basque country and in Navarre. I simply offer this as a possible tool for the Government's regional economic policy armoury. We have all signed up to the Treasury's policy aim of narrowing the gap in regional economic growth between northern countries and southern ones. Perhaps different bands of taxation would be a more effective tool in incentivising business growth.
I want to concentrate on two sources of instability. We have been told that the Government are confidently navigating us through calm waters, but as we have heard, there are certain whirlpools of instability.