Business leaders are urging Rachel Reeves to take the “opportunity to boost confidence” amid fears tax rises could stiffle growth.

Firms have admitted they expect there to be no growth over the next three months, marking the second consecutive quarter when businesses have not expected any growth over the near-term.

Alpesh Paleja, an economist at the lobbying group CBI , said: “Our latest surveys paint a picture of an economy shifting down a gear as we head into the final quarter of 2024.

“Weaker growth expectations are weighing on firms’ hiring intentions, which have treaded water since the beginning of the summer.

“In the budget, the Chancellor has an opportunity to boost confidence despite the difficult fiscal picture.

“Business will want to see messages of hard choices balanced with interventions that deliver a vision of optimism.”

He added: “Giving firms certainty over future tax plans in the form of a business tax roadmap, measures to enhance productivity, and the country’s net zero trajectory can all help cement the path to long-term growth.”