Leaving the European Union (EU) without any deal would be better for the UK than a Canada-style free trade arrangement, Theresa May has said.

The comments, made by the Prime Minister arriving at a United Nations summit, distinguish her position from leading Brexiteers such as Jacob Rees-Mogg who say a free trade deal is the preferred option.

In a speech at Bloomberg in New York, the Prime Minister will also outline a vision for a low-tax Britain to attract businesses from around the world.

Mr Rees-Mogg and most of his European Research Group (ERG) of MPs say leaving the bloc on World Trade Organization (WTO) rules is preferable to Mrs May’s “soft” Brexit plan to remain aligned with all EU rules on goods.

Similar to EU bosses, the Prime Minister argued that a trade deal would be difficult because of the Irish border. The ERG, meanwhile, says the issue is being exaggerated to keep the UK tied to the bloc and the border can be kept open with technology.

According to Sky News, Mrs May said: “I’ve always said no deal is better than a bad deal, and I think a bad deal, for example, would be something that broke up the United Kingdom. What we’ve put on the table is a good deal.

“It’s a deal which retains the union of the UK, our constitutional integrity, it’s a deal which provides for no hard border between Northern Ireland and Ireland, protects jobs and enables us to have a good trade relationship with Europe and the rest of the world.”

On tax after Brexit, Mrs May is expected to pledge Wednesday to use low tax and “smart regulation” to make post-Brexit Britain an economic powerhouse in Europe.

She will say the UK will have “the lowest rate of corporation tax in the G20” after leaving the bloc, making it “one of the most business-friendly economies in the world”, The Telegraph reports.

The statement has been interpreted as not only an appeal to international business but also to Brexiteers on the political right of the party, who are losing faith in her post-Brexit vision for the nation.

Meanwhile, Mark Francois, the vice chairman of the ERG, said the position of the 60-strong group of MPs on Mrs May’s Chequers plan is hardening.

He said: “If push really comes to shove, and they try to push Chequers through the House of Commons, then I and my colleagues will vote against it.”