Rachel Reeves’s upcoming Budget handed damning blow as Britons deliver verdict on Labour plans

Just two per cent thought the Government had done "very well", while 10 per cent said it had been handled "fairly well".

In contrast, 27 per cent of those surveyed said the Government had approached it "fairly badly", while 36 per cent said "very badly" and 25 per cent said they didn't know.

More than half of those who answered "very badly" to the poll question were aged 65 and over, while the lowest percentage of those who gave the same answer were aged between 18 to 24.

Chancellor Rachel Reeves had been expected to raise income tax in her Budget in the face of a yawning gap in her spending plans, hinting that the alternative would be "deep cuts" to public investment.

She however ditched the plans last week.

Ms Reeves is understood to have U-turned following improved forecasting from the Office for Budget Responsibility, though other tax rises have not been ruled out.

Limits to salary sacrifice schemes and new measures to tax electric vehicles are still in the mix, as the Treasury pursues a "smorgasbord" approach of raising a range of smaller taxes.

There are reports the Chancellor will extend the freeze on income tax thresholds for two years until 2030, in a move that could raise some £8billion a year for the Treasury.

She could also introduce a new levy on some of the most valuable homes, which would mainly affect properties in London and the South East, according to The Telegraph.

A Treasury spokesman said: "We do not comment on speculation around changes to tax outside of fiscal events."

Despite the U-turn on income tax, the Chancellor still intends to give herself larger fiscal headroom – the buffer against economic headwinds which could affect Government spending plans.

Ms Reeves has been laying the ground for tax rises over recent weeks, including during an early-morning speech on November 4 aimed at preparing people for the budget.

Downing Street said on Friday, November 15, that the thrust of the speech still stands.

The Prime Minister’s official spokesman said: "She was very clear about the challenges the country faces and her priorities in addressing those challenges. All of that still stands."

The spokesman refused to comment on budget speculation, but said the Chancellor will aim to "build more resilient public finances with the headroom to withstand global turbulence".

Independent Economist Julian Jessop said the U-turn demonstrates the Government is "not willing to make tough decisions on tax".

"We already knew that about spending, but now we know it about tax as well," he told GB News.

"The second problem is that the alternatives to raising income tax are much less certain in terms of the amount of money they might raise.

"So instead of doing a sort of fairly clean increase in income tax, she's going to raise money in all sorts of other ways.

"It's been described as a smorgasbord, but I think I'd call it a dog's breakfast.

"So lots of individual tax changes that could be very damaging. And finally, if this was done for political reasons, it's backfired.

"I mean, [Sir Keir] Starmer and [Rachel] Reeves, their positions seem even less secured than they were. And the markets fear that the alternative to either of those people would be even worse than the current lot."