As Budget fever hots up, the CBI will today warn the chancellor to look to economic growth rather than higher taxes to boost public sector investment.

CBI chief Digby Jones is set to tell Gordon Brown that imposing higher taxes to fund the NHS on business would be a "bitter blow" for struggling firms.

Arguing that the tax burden on business has already gone up by a cumulative £29 billion since 1997 while profitability has declined, Jones will say that for every extra 0.5 per cent of growth in GDP at least £2 billion would flow into Treasury coffers.

This could pay for an NHS spending increase of four per cent per year on top of current commitments, he says.

"Business shares the desire for better public services. But in the long run it is a successful economy and successful businesses that will solve NHS funding problems. In the end, that is the only way to get the money to deliver improvements," he will say.

"Increasing business taxes would be a bitter blow. Not only would it harm companies that have fought so hard to survive a painful global slowdown. It would hinder firms that could create the growth needed to help deliver the government's public sector promises.

"What the business sector needs is tax help, not tax increases. Profitability has fallen sharply over the last few years. The chancellor cannot afford to ignore that if he wants stable long-term finances for our struggling NHS."

In its Budget submission to the Treasury, the CBI called for tax reductions for businesses of £2 billion, including tax credits to encourage research and development.

Jones was also encouraging the government to continue the process of reforming the NHS. Business is an important customer of the NHS, he will argue, with sickness absence from work costing the UK some £23 billion a year, "due in part to our inadequate healthcare system".

"If there is to be more money for public services, it must be linked to significant reform. Ministers must show they have the mettle to push through the change they know is needed."

He will add: "Business is just like the public. We do not want more of the same. We want and deserve something that is better."