George Osborne is expected to use his Budget to announce a £6billion boost to the country ’ s finances . George Osborne is expected to use his Budget to announce a £6billion boost to the country ’ s finances that will be used to fund tax cuts for the middle classes . Economists believe ‘ a cocktail of good news ’ including falling inflation will cut the borrowing bill by about £20billion . The EY Item Club , which compiles its forecasts using the Treasury ’ s economic model , said it expected the Office for Budget Responsibility to reduce the borrowing forecast for next year by £6billion . It was also claimed last night that owners of homes worth up to £1million will be able to pass them on to their children tax-free under plans drawn up by the Chancellor . Mr Osborne ’ s proposal is expected to become a key part of the Tory manifesto , but it will not be included in tomorrow ’ s Budget after it was blocked by the Lib Dems . Plans to raise the inheritance tax threshold to £1million were included in the party ’ s manifesto at the last election , but were vetoed as part of the Coalition deal . According to Treasury papers leaked to The Guardian , the proposed measures would also reduce the inheritance tax bill on properties worth up to £2million by £140,000 . The tax break , which would mean around 20,000 fewer estates every year would have any inheritance liability , is expected to cost nearly £1billion . Scroll down for video . In the papers , the officials note that the move ‘ will generally be very popular with the public and in the media ’ . The document , prepared for Treasury financial secretary David Gauke , added : ‘ You have indicated a desire to reduce the burden of inheritance tax . ‘ Having considered the cost of a substantial increase in the existing nil rate band you and the Chancellor have indicated you would like instead to introduce a more targeted measure to allow the family home to be passed onto the children of deceased without it leading to an inheritance tax liability . It is thought the Lib Dems leaked the papers ahead of the Budget in a bid to paint to Tories as the party of the rich . ‘ This reflects the concern raised by the public about rising house prices increasingly leading to estates with a modest house ... paying inheritance tax. ’ A senior Tory source blamed the leak of ‘ old advice ’ on the Liberal Democrats , adding : ‘ They are desperate . There is nothing in the Budget on inheritance tax , which we have said repeatedly is an election issue. ’ It is thought the Lib Dems leaked the papers ahead of the Budget in a bid to paint to Tories as the party of the rich . The Government is set to announce the biggest real-terms increase in the minimum wage since the financial crisis . The standard rate will rise 3 per cent from October to £6.70 an hour , benefiting 1.4million , while the rate for apprentices will go up by a fifth , to £3.30 . The changes , to be announced in the Budget , come amid the strongest economic growth for seven years and the lowest inflation for more than a decade .
The EY Item Club predicts tomorrow borrowing forecast will be £6bn less . George Osborne expected to use the money to pay for range of tax cuts . Homes worth up to £1m will be able to be inherited tax free , say insiders . Proposal is expected to become key part of the Tory manifesto for election . Will not be included in next year 's 's Budget after being blocked by Lib Dems .