Alistair Darling bowed to pressure last night and cut the planned 5 per cent rise in business rates that was threatening to cripple many small firms.

In a last-minute reprieve, the Chancellor said that the rate rise, which applies only in England at present, would be scaled back to 2 per cent this year, and that businesses could spread payments of the remaining 3 per cent increase between 2010 and 2012.

Read the full report in The Times here