You've taken gamble, IMF warns Brown

The threat of big tax rises or deep spending cuts returned today as Gordon Brown was warned there could be serious economic trouble ahead.

The International Monetary Fund, in its annual report on Britain's economy, accuses Mr Brown of a gamble which could leave a gap of more than £10 billion in his budget.

The IMF questioned his assumption that tax revenue will rise to ease the burden of government borrowing. It warned: "We see significant risks to these projections."

However, the report says that Britain's economic performance in the last few years has been "enviable".

But the Tories said the overall verdict of the report confirmed that Mr Brown would be forced into tax rises or spending cuts or both.

Shadow chancellor Oliver Letwin said: "It is clear that the IMF believes Gordon Brown will have to raise taxes if he intends to continue with his present spending path. He is borrowing now in order to postpone tax rises until after the next general election."