CHANCELLOR John Healey must cut spending in his first Budget instead of hiking taxes, Rishi Sunak said.
The former Prime Minister said his successor in the Treasury should signal to the markets he will control public spending.
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Mr Sunak wrote in The Sunday Times: “He should make clear that he’ll not increase taxes in the budget and that if adjustments need to be made, he’ll cut spending.
“That would provide the certainty needed in an increasingly uncertain world.”
He said Mr Healey must avoid repeating the mistakes of Rachel Reeves with “constant, confidence-sapping speculation about which taxes will rise”.
The new Chancellor will give a speech on Monday in the West Midlands outlining his vision for economic growth.
However, he set a gloomy tone in an interview with the Financial Times in which he warned of a tough Budget this autumn due to the Iran war.
He said: “What’s happening in the Middle East is hitting inflation, it’s hitting growth, it’s hitting borrowing costs. It’s part of a more dangerous world that is more uncertain.”
His tone is in stark contrast to bouncy Prime Minister Andy Burnham who entered No10 with costly ambitions to please voters.
Shadow Chancellor Andrew Griffith warned: “It would be completely wrong for John Healey to raise taxes on hard working families.
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“Especially given our people pleasing Prime Minister will only use the money for more handouts rather than defending our nation.”
It comes as the Government announced a plan to free businesses from costly red tape.
They promised to slash complicated reporting rules under a change that will save businesses more than £450 million a year in total.
Currently, the rules require small cafes chains and hotels to spend thousands on wordy reports.
Business Secretary Jonathan Reynolds said: “No-one goes into business to fill out forms.
“For years, hardworking firms in this country have been weighed down by pen-pushing paperwork and frustrating costs, ticking boxes that do nothing to help them grow their business.
“We’re stripping back outdated bureaucracy and building a common-sense system fit for a 21st-century economy. This will cut the cost of doing business, giving breathing room to bosses across the country, and free them up to focus on what they do best, creating jobs and growth.”