British business groups welcomed proposals in Mr Gordon Brown's pre-budget report yesterday, but said he should have done more to improve the business environment.

"Although we found them a reasonable set of proposals, one of our major concerns remains, namely, the rising tax and regulatory burden on business," Mr George Cox, head of the Institute of Directors, said in a statement, adding that the tax system needed to be simplified too.

"These measures will give business a much-needed boost and won't pose a threat to economic stability," Mr Digby Jones, chief of the Confederation of British Industry, said in a statement.

"We are pleased that he has delivered a package that will go some way to reduce the costs to business of using the roads," Mr Jones added.