LONDON (Bloomberg) — The UK's main opposition Conservative Party said Prime Minister Gordon Brown should cut the rate of corporate tax to encourage growth in the economy and boost Britain's competitiveness.

George Osborne, the party's Treasury spokesman, said business should pay a simplified rate of 25 percent, down from the rate of 28 percent that is scheduled to be introduced in April at the start of the next fiscal year. The government should also abandon the planned rate increase for small businesses to 22 percent from 20 percent, Osborne said.

"The corporation tax rate is one of the most uncompetitive in the world," Osborne told the BBC's Sunday AM programme yesterday. "We live in a globalised economy where these businesses can either invest in Britain or they can go to China or go to Ireland where there is a 12.5 percent rate."

The Conservatives say that Britain currently has the 19th lowest rate of corporate tax in the European Union. Cutting the rate to 25 percent would give the UK the 12th lowest rate, level with Austria, Slovenia and Greece.

"So having a low corporation tax rate is extremely important in a modern economy if we are going to attract jobs to this country," Osborne said, adding that simplification of the tax system was a "tough decision" because some businesses benefit under the current regime.

Alistair Darling, the Chancellor of the Exchequer, will make a budget statement to Parliament on March 12.