If he carries on like this, Alistair Darling will set a record for the most policy U-turns by a chancellor of the exchequer. His decision to scrap reforms to the taxation of foreign profits – which threatened to provoke an exodus of companies from Britain – is the right one and should be welcomed. But the Treasury’s serial reversals are no way to make tax policy. Not only is it humiliating for the government to be forced to backtrack on fiscal decisions, each retreat only adds to the uncertainty over corporate taxation that businesses loathe.

A revenue-neutral package of reforms to the way overseas profits are taxed, including a plan to allow their tax-free repatriation, was announced last year. The aim was to bring Britain into line with much of the rest of Europe while preventing revenues from escaping offshore. The accompanying plan for a crackdown on tax avoidance to protect against that potential revenue loss was flawed and met a hostile response. It unfairly threatened to penalise multinationals with high levels of intangible assets – including media, pharmaceuticals and other consumer product companies.