The Conservatives launch their business manifesto today promising to cut regulation, reduce business rates, reform capital gains tax and abolish the climate change levy.

The party gets a boost from the Telegraph which publishes a letter from 140 leading businessmen and women endorsing Tory business policy.

The letter is likely to be an embarrassment to Tony Blair and Gordon Brown who last week claimed Labour was the new party of business and used a letter of support in the Times from 58 business people to back up their case.

The Telegraph letter, whose signatories include industrialist Lord Hanson, Rentokil chief executive Clive Thompson and John Clare, chief executive of Dixons, claims that Labour has jeopardised the competitiveness secured for the UK economy by the reforms of Margaret Thatcher and John Major.

The business leaders speak of their fears of increased labour market regulation under Blair. "Britain's reputation of having an attractive regime, intelligent regulation and a flexible labour market is still under threat," the letter says.

The Conservative business manifesto includes:

- Abolition of climate change levy, IR35 and the aggregates tax.

- £200 million cut in business rates for small companies.

- Business rate cuts worth £1,00 a year for rural businesses.

- Cuts to capital gains tax in the long-term.

- Simplified VAT.

- A deregulation commission with powers to block legislation, unless overruled in both house of parliament.

- A year-on-year cut on each department's red tape.

- A campaign for an EU /NAFTA trade agreement.