The firm said the chancellor may make some changes to reflect higher house prices and incomes, but said he was unlikely to go far enough.

Cormac Marum, tax partner, said: 'I think the chancellor may have a mixture of good and bad news for the taxpayer but it is predicted he will announce evolutionary, limited measures affecting the individual. We hope for some changes to key taxes particularly where they need to be brought in line with price rises over recent years, but we don?t expect drastic change.'

KPMG said the nil rate band for IHT would need to increase to £400,000 to keep pace with house inflation, which has rise 165% over the last 10 years, for instance. Cormac said Gordon Brown was likely to make a small rise, to around £263,000.

The firm said the chancellor will probably continue with normal indexation provisions on personal allowance. On stamp duty for homes, the firm said Brown may introduce an intermediate rate of 2% on sales between £250,000 and £350,000.