In the speech, given at a News International conference in Mexico, Mr Howard called for lower taxation, saying: “Our economy needs to become more like America’s again”.

He added: “Britain is following the wrong path. Business is becoming less competitive. We must get a grip on public spending, cut back on waste, reduce regulation and cut taxes.”

The Tory leader stressed his opposition to a European super-state and accused Chancellor Gordon Brown of favouring a negative European-style economic model of heavy regulation and high taxes.

Mr Howard contrasted the average European Union tax burden of 41 percent with America’s 28.9 percent.

“America has created the most successful form of capitalism in the free world, and so it should set an example to us all,” he said.

The Tory leader’s speech was the first to the News Corporation by a British politician since Tony Blair in 1995.

Worryingly for Labour, Media mogul Mr Murdoch has publicly declared that the Sun, Britain’s biggest selling daily tabloid, might back Mr Howard at the next election.