UK Treasury chief warns of tax rises in case of EU exit

Britain's Treasury chief has sounded another warning about how a 'leave' vote to Brexit referendum on June 23 would damage the economy, arguing he would have no choice but to raise taxes and slash spending.

The comments threw more fire into an already heated debate that has reached into every aspect of life in Britain.

On Wednesday, it was the turn of fishermen to make their views known with campaigners in favor of 'leave' organising a flotilla up the River Thames to protest the European Union's (EU) fisheries policies, which some seafarers find discriminatory.

Rolls Royce wrote a letter to its employees warning that a British exit, would be bad for business.

But it was Osborne's remarks that seized the most attention, in part because of their dire nature. He said that the government would have to raise income and inheritance taxes to fill a 30 billion pound budget vacuum that will emerge if Britain leaves the EU.

"No Conservative wants to raise taxes least of all me," Osborne said, adding, "But, equally, Conservatives understand and, indeed, I suspect many Labour politicians understand that you cannot have chaos in your public finances."

Furious members of his party backing Brexit say they'll block any attempts to impose an emergency punishment budget and warned that Osborne's position would be untenable if he tries to push through tax increases. The opposition Labour Party also warned they would not support any budget that slashed public services.

'Leave' camp described the 'remain' camp's position as hysterical prophecies of doom.

The back and forth underscores the political civil war among the Conservatives over the issue.

The increasingly hostile campaign has largely and publicly pitted Prime Minister David Cameron's 'remain' camp against former London Mayor Boris Johnson's for 'leave'. A direct challenge to Osborne mires the party deeper into squabbles that will stretch past the referendum.

"If he were to proceed with these proposals, the chancellor's position would become untenable," the 57 lawmakers who signed the letter said. "This is a blatant attempt to talk down the market and the country. The chancellor risks doing damage to the British economy in his bid to win this political campaign," the letter further added.

Even as lawmakers challenged Cameron to explain his views to the House of Commons on Wednesday, a small flotilla of some 30 vessels glided up the Thames outside the Houses of Parliament to back an exit from the EU.