A STALWART of accountancy giant EY’s tax practice has returned to Scotland after spending 17 years running various business interests for the firm in London.

Aidan O’Carroll, who led the Scottish tax practice of what was then known as Ernst & Young in the 1990s, took up the UK tax-head role in 2000 after having a brief stint away from the business at Rutherford Manson Dowds, which is now part of Deloitte.

After taking on positions including global tax markets leader and global compliance and reporting leader at EY, Mr O’Carroll has returned to Scotland to play his part in developing what he views as the country’s next phase of growth.

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“When I had the opportunity to come back to Scotland it was not just to be part of the tax business here but to bring the experience I’ve had over the past 17 years working globally,” he said.

“I’ll be advising the entrepreneurial community at a time when I think Scotland is at a pivotal point.

“There are opportunities for Scotland to grasp its place in the world, regardless of political leanings or Brexit and all the uncertainty that creates.”

Mr O’Carroll said part of the opportunity for Scotland revolves around how it maintains its position as the most attractive place after London for foreign businesses to invest in.

“Increasingly we’re seeing investment going to other EU countries,” he said. “What can Scotland do to attract the right kind of businesses to invest in the Scottish marketplace?”

Mr O’Carroll would not comment on what he believes the Scottish Government, which has committed to looking at the income tax regime as part of its latest programme for government, should do in terms of altering existing tax bands and thresholds.

However, he said that any changes would have to be weighed against deterring any economic activity that could result in a greater tax take in the longer term.

“The challenge the Scottish Government has is how it goes about driving its public service agenda at the same time as coming up with a more sustainable economic model,” Mr O’Carroll said.

“It’s in everyone’s interests - business, the public at large and the Government - to make Scotland bigger.

“If you keep it that simple and make the economy bigger and business bigger, then you have the opportunity to increase the amount of revenue that the Government is able to raise from taxation.

“To my mind that is the right kind of taxation because it focuses on growth but also ensuring the reinvestment of the wealth created by individuals and companies, not just back into the economy but into enterprises to fuel more growth.”

Mr O’Carroll believes more could be done in terms of tax credits to help the start-up firms of today turn into the big businesses of tomorrow that will not only create jobs and therefore revenues from income tax but also a greater amount of corporate taxes too.

Technology in particular is a sector that has benefited from such reliefs, with Edinburgh holiday search business Skyscanner, which was acquired by China’s Ctrip last year in a £1.4 billion deal, being helped in its early years by tax reliefs.

In its accounts for 2016, its last full year before being taken over by Ctrip, Skyscanner’s profit figure was boosted by an £18 million tax credit that its founder Gareth Williams noted was a “one-off” related to employees’ shares in the business.

This, said Mr O’Carroll, is precisely how governments should be looking to help entrepreneurial business because it gives them the freedom to grow before they “take it to the next level when they are in a tax-paying position”.

“We need 20 Skyscanners in Scotland, not just one or two,” he added.

Although Scotland has no powers when it comes to setting corporate tax rates, which are the responsibility of Westminster, Mr O’Carroll believes it is “only a matter of time before Scotland gets more devolved powers” as a result of Brexit.

“At the end of the day Scotland will have more powers,” he said.

“If we can grasp those powers to make a competitive difference to make Scotland even more attractive that must be a hugely positive thing.”