Warning signs: Theresa May attended her first European Council meeting in Brussels last week

A secret plan to slash corporation tax by half has been hatched as a “nuclear option” to counter threats that Brussels will impose a “brutal Brexit” on Britain.

Under the plan the UK would cut the tax’s rate from 20% to 10% if Britain’s EU rivals blocked a free trade deal with the UK or refused to give financial services firms access to the European market.

Senior figures in Downing Street believe such a drastic move on business taxes would encourage firms to stay and make the UK a magnet for new companies, as Ireland and Singapore have become.

The plan has been floated by Theresa May’s closest advisers amid growing fears that the other 27 member states are taking an increasingly hard line against