Labour on brink of 'disastrous' foreign profits tax u-turn

Tory shadow chancellor George Osborne has claimed Alistair Darling is on the brink of his 'seventh major u-turn' since becoming chancellor with a climb-down over the taxation of foreign profits.

He said: 'Another day, another u-turn from Alistair Darling!'

Osborne said he welcomed indications the chancellor has 'ditched this disastrous policy' but complained even proposing a tax on foreign profits had been 'deeply damaging to UK business'.

He said the switch followed changes on the 10p tax rate, capital gains tax and fuel duty and forecast: 'It cannot be long before the chancellor is forced to u-turn on his plans to increase road tax for millions of families.'

He complained that instead of strong leadership there was an absence of direction and 'a failing government driven by events'.

Osborne's attack followed reports Darling was about to scrap the proposal because of a threatened exodus of companies from the UK. It originated as part of a crackdown on avoidance.