Rishi Sunak has been urged to put a £12bn tax raid on hold after the Bank of England warned that the new coronavirus variant poses a risk to the British economy.

Lord Bilimoria, the chairman of Cobra beer and head of lobby group the Confederation of British Industry, said it is “absolutely the wrong time” to raise taxes given the threat facing the economy.

It came as Threadneedle Street said that the rise of the more infectious omicron variant adds to uncertainty over future growth, and business lobby groups launched a coordinated push to win more financial support from the Treasury.

Mr Sunak, the Chancellor, is to increase National Insurance contributions in April to raise £12bn a year and plans to put up corporation tax in 2023. Hospitality businesses also face a hike in VAT to 20pc when the government’s temporary relief ends in April. Economists have warned the country now faces its highest tax burden since 1951.

Lord Bilimoria said: “This is absolutely the wrong time to have the highest tax burden for 70 years. We need to be helping our economy and businesses that have suffered so much. The government must be incentivising growth and investment.

“Business is grateful for the support so far, it has saved millions of jobs. But the recovery – which was meant to be a ‘bounce back’ recovery – has ended up being a very fragile recovery. 

“From the summer, we’ve had labour shortages, an energy crisis and queues at the petrol pumps. Inflation is already over four per cent. Businesses and consumers are under a lot of pressure and on top of all of that we’ve got this new variant. It is the worst possible time to have such a high tax burden. So we are saying to the government: please you should not be doing this.”

Michael Spencer, the billionaire trading entrepreneur and Tory donor, said: “I wasn’t in favour of the tax rises anyway. They should cancel the lot, but they won’t.”

Many Conservative MPs are also concerned about the impact of higher taxes on the recovery.

It is feared that the National Insurance increase will hurt demand by costing a typical worker £255 a year, while also deterring investment and hiring because businesses pay too.

John Redwood, a veteran Conservative backbencher, said: “The latest Omicron measures will hit hospitality, travel and entertainment jobs and businesses again. “More reason to cancel the coming National Insurance increase to limit the damage to incomes.”

Business lobby groups called for extra financial support from the government in a meeting with Business Secretary Kwasi Kwarteng last night.

It is understood groups including the Institute for Directors and the Federation for Small Businesses are pushing for a cancellation or delay to the rise in National Insurance planned for April.