Speculation is growing that Prime Minister Gordon Brown is planning a £15bn package of tax cuts to boost the ailing economy.

Over the weekend Mr Brown fuelled expectations of tax cuts in the upcoming Pre-Budget Report when he said there was an “emerging consensus” internationally on the need for fiscal policy to support the interest rate cuts announced by the Bank of England and European Central Bank.

He and Chancellor Alistair Darling have repeatedly stated that now is not the time to take money out of the economy, as businesses look for consumer spending to maintain growth.

The Treasury refused to comment on the contents of Mr Darling’s PBR, due within the next few weeks, and dismissed as “speculative” a report in the Financial Times which said he was considering an emergency package of tax cuts and public spending.

But the Sunday Mirror quoted an unnamed “senior ministerial source” as saying: “There’s going to be a major package of tax cuts and public spending.

“We’re not trying to spend our way out of trouble, but urgent action is needed to stimulate the economy. We’re talking about measures totalling between £10bn and £15bn.”

The paper suggests Mr Darling could increase tax credits for low-income families, extend the stamp-duty “holiday” on less expensive homes, boost the winter fuel payment for the elderly, delay planned hikes in petrol duty or even cut the basic rate of income tax.

Meanwhile, the Sunday Express predicted tax cuts worth an average of £480 to every household in the country, quoting an unnamed minister as saying: “Public finances are tight but tax cuts can be justified in the current circumstances. We have to find a way of putting money into people’s pockets because they are really hurting.”

With Mr Brown making clear he does not plan to cut back on public spending, any tax reductions are likely to have to be funded from borrowing, raising the spectre of tax hikes after the current economic downturn has concluded.

Conservative leader David Cameron yesterday warned that the tax cuts reportedly being considered by Mr Brown would risk higher interest rates and higher taxes in the future.

Writing in the News of the World, Mr Cameron said that “the cupboard is bare” due to Mr Brown’s record of borrowing and spending.

And he added: “Even worse, he’s talking about borrowing even more. And what does that mean? The risk of higher interest rates — and mortgage bills — and higher taxes to pay off the debt tomorrow.”

Mr Cameron said that lower taxes are “in my DNA”, but said that Tory plans to freeze council tax, delay VAT for struggling small businesses and raise inheritance tax thresholds are “based on responsibility and won’t need an extra borrowing splurge”.

He added: “That’s the choice. This Government has maxed out our nation’s credit card — and they want to keep on spending by getting another.

“We believe we need to get a grip, be responsible and help families now in a way that doesn’t cost us our future.”

Meanwhile, it is thought that the Conservatives are preparing to unveil new tax cutting proposals within the next few days, aimed at staving off unemployment.

This could involve scrapping National Insurance payments for new workers, according to the News of the World.

The Tories are expected to argue that, unlike the help on offer from Mr Brown, their tax cut will be fully funded and will not require additional borrowing.

A spokesman for the party declined to confirm the tax-cutting plan, describing reports in the Sunday papers as speculative. But the Sunday Telegraph quoted an unnamed party source as saying that it would involve a “recession-alleviating measure” and would be paid for by cutting government spending elsewhere.