The Tory party is reportedly coming under pressure over its policy to reduce the tax deductibility of interest charged on corporate debt.

The party has signalled it wants to cut the tax relief as a way of funding a reduction in the headline rate of corporation tax.

However, The Financial Times reports mounting opposition. Jeegar Kakkad, of the EEF Manufacturing group, is reported as saying: ‘Interest deductibility is potentially too big a price to finance a reduction in headline rate.’

Chris Sanger, partner at Ernst & Young, is insisting the relief helped build businesses in the UK. ‘Any significant change risks making the UK far less attractive,’ he told the paper.