Alistair Darling told the CBI's annual dinner that the Government listened carefully to what the business group said, but admitted that getting business tax right was not easy.

The Chancellor, addressing the 1,500 delegates in the wake of recent tension with the business community over capital gains tax and tax arrangements for non dom employees, said he was determined that British business will not be the "fiscal fall guy".

He also expressed optimism about the underlying strength and resilience of the British economy and said he was confident the country would get through the current world economic problems.

He said British business was doing well, with healthy order books at home and abroad, and the economy would continue to grow, underpinned by record levels of employment.

"Getting business tax right is not easy. We recognise that the need to fund public services - like universities and transport - from which you benefit, must be weighed against the need to maintain competitiveness. We need to get the balance right.

"I also have to ensure that tax rates encourage investment by providing incentives to innovate and encourage growth.

"We listen carefully to what you have to say, and we will consult on significant changes which will affect your future competitiveness.

"But we need the right corporate tax structure in order to be able to compete in the next 10 or 20 years. That is why I set up a group of business experts to examine what we need to do to ensure that Britain remains a good place to do business.

CBI president Martin Broughton told the dinner that the UK must not talk itself into a recession in the wake of the credit crunch, adding that the economy was strong enough to weather the storm, provided the right decisions were made.