Britain should respond to a no-deal Brexit with tax cuts, increased spending on infrastructure and policies that will draw “global talent” to the country, Sajid Javid has suggested.

The Home Secretary told a specially convened Cabinet meeting last week that the Government should introduce new “tax incentives”, thought to include ­targeted cuts, to help the economy withstand the effects of leaving the EU without an agreement.

The intervention, seen as a rebuke of Philip Hammond’s insistence the Treasury could not afford tax cuts, will be welcomed by senior Brexiteers who have urged the Chancellor to prepare radical reforms of the economy to take advantage of the “opportunities” of Brexit.

It is likely to be seized on by EU leaders, who fear the UK will use Brexit to transform into a low-tax economy that could draw business away from the Continent.

Today, Priti Patel, the former cabinet minister, and Steve Baker, who ­resigned as Brexit minister in July, ­accuse Theresa May’s officials of selectively leaking sections of a separate presentation by Mark Carney, the Bank of England governor, in order to create fear over the consequences of voting down Mrs May’s Chequers plan.

Hours after the meeting it was ­reported that Mr Carney had warned ministers house prices would fall by 35 per cent after a no-deal Brexit.