I will aim to cut taxes at every budget, pledge Shadow Chancellor George Osborne

Insisting that "taxes should be lower", the Shadow Chancellor pledged that if elected he would seek at every Budget to ease the burden on households.

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He also rejected demands from Right-wing backbenchers for the party to rethink its commitment to stick to Labour's planned spending increases.

These would give schools and hospitals 2.1 per cent extra for each of the coming three years.

He said spending growth was lower than in Margaret Thatcher's first Parliament and warned that those demanding further cuts would take the party "on to the margins of political debate".

Tory leader David Cameron fears Gordon Brown will claim - as he has in the the past three election campaigns - that public services would be at risk.

Mr Osborne's three-year spending-pledge is likely to expire not long after the next election. Tory sources said this might give "wriggle room" for tax cuts over the following years.

The Shadow Chancellor - who is rumoured to favour a bolder approach on tax to Mr Cameron - indicated that a cut in corporation tax to help business is top of his list.

He described Ireland as a "poster-child country" that has reaped huge rewards from attracting foreign investment with low business levies.

"There is now a compelling case for a reduction in Britain's headline corporation tax rate," Mr Osborne said.

"In the age of globalisation, 28 per cent is too high. If British business is to compete effectively then the rate of corporation tax needs to come down."

Initially, he said, a Tory government would reduce corporation tax rates by "broadening the base - in other words by removing the reliefs and allowances which in any case create complexity and lead to unexpected distortions".

He enthusiastically embraced green taxes, saying a Conservative government would raise the proportion of total taxation that come from levies on pollution. Under Labour, the figure has fallen from 9.7 per cent to 7.3 per cent.

The proceeds, he said, would pay for reductions in taxes on hardworking families - with tax breaks for marriage a priority.

Mr Osborne also restated his commitments to abolish inheritance tax for everyone but millionaires and scrap stamp duty on properties worth £250,000 or less. These ideas were credited with reviving the party's fortunes last year.

"I am clear that in a fiercely competitive global economy taxes should be lower," he added.

"The state consumes too much of the nation's income, and then spends too much of what it takes badly.

"So as Chancellor I will approach each budget looking to see if we can reduce taxes as well as reform them."

But he warned: "Nothing is more damaging to the reputation of politics than parties that promise to cut taxes and end up increasing them.

"We remember Gordon Brown and Tony Blair promising no tax increases at all. So I will only reduce taxes if those reductions are lasting and sustainable."

Mr Osborne gave short shrift to Tory MPs demanding a clearer "dividing line" on tax now.

He said more brutal cuts to spending over the next three years would almost certainly be "unachievable" in the coming economic slowdown.

He added: "I don't dismiss the frustration of Conservatives that borrowing is so high, that taxes are at record levels and that government has grown so large.

"I share that frustration. But there is no quick-fix solution."

Mr Osborne promised an end to Labour's "stealth tax" rises, saying a Tory government would allow Parliament to scrutinise proposed changes months in advance and create a new semi-independent office of tax simplification.

Yvette Cooper, Chief Secretary to the Treasury, said: "This is reheated, reckless nonsense from the Tories that would put the economy at risk.

"George Osborne is still promising to keep spending the same amount alongside unfunded tax cuts and spending more on whatever his latest audience wants to hear.

"His opportunism just doesn't add up. The last time the Tories did this, it ended in 15 per cent interest rates and three million unemployed."