Baku, July 5, AZERTAC

Britain has announced plans to cut corporation tax to less than 15 percent in an attempt to cushion the shock of the country's decision to leave the European Union, raising the prospect of competitive tax cuts across the bloc, according to Reuters.

Finance Minister George Osborne told the Financial Times he wanted to build a "super competitive economy" with low business taxes and a global focus, signaling a determination to remain in his job when a new prime minister takes over in September.

The new rate, which was announced without a target date, compares with Osborne's previous target to cut corporation tax to 17 percent by 2020 from 20 percent now. The average rate among the world's most developed countries is 25 percent.

Confidence in Britain's economy has been hit by the vote to leave the EU and a lower tax rate could help prevent an exodus of British firms and attract U.S. and European companies which might otherwise be put off by the uncertainty it has created.

"The prospect of a lower tax base remains appealing for some U.S. companies regardless of Britain's future status within the EU," said Ferdinand Mason, a London based partner at law firm Jones Day. But Britain would also need to negotiate a Norway-style deal on market access with the rest of Europe, he said.

"If Britain is to become a truly attractive proposition to foreign investors, it is crucial that the UK negotiates a deal with the EU that gives it access to the single market."

Ireland, where a 12.5 percent corporate tax rate has been a cornerstone of economic policy for 20 years, drawing investors such as Pfizer and Apple, said Osborne's announcement showed how the Brexit vote had altered the dynamics of the EU.