Four senior ministers are due to meet in just days to discuss the budget and how to make progress to the economy.

There is a divide between the Tories and the Liberal Democrats over the move to cut the rate of income tax.

The Liberal Democrats acknowledge that they are not able to prevent Osborne’s demands. They have also made it clear that in order to boost the economy, the rich must be taxed rather than the poor.

Labour has condemned this move and believes this will increase the growing gap between the rich and the poor.

David Cameron is just as focused as Osborne on reducing the tax. A government source has stated that there needs to be a balance in the budget, to show that we are all in this together and to prove that the UK is open for business.

If there is a reduction to the 50p tax, the Lib Dems hope to introduce a wealth tax based on property as well as a huge increase in the personal allowance for those who are in work.