A budget to sell to the next election: PM

Malcolm Turnbull has vowed to sell the government’s latest budget all the way to the next election.

The prime minister, addressing a meeting of Liberal and Nationals MPs in Canberra on Tuesday, urged his colleagues to personalise the budget message of a strong economic plan for jobs and growth and one that delivered tax relief, ensured the delivery of essential services as well as providing funding for new infrastructure to make life better for ns.

Mr Turnbull noted the budget’s better-than-expected revenue booty was down to the creation of one million jobs during the life of the government and 130,000 fewer people on welfare.

As well the government had delivered the lowest spending growth in 50 years, he said.

The prime minister reiterated his commitment to an election early next year, leaving open the possibility of another budget before voters go to the polls.

Treasurer Scott Morrison has promised his third budget will show the government knows to deliver a stronger economy with a plan that will improve opportunities for all ns.

“It’s a plan for lower taxes and for reducing the pressure on households,” he told reporters on his way into Parliament House.

But shadow treasurer Chris Bowen says tax cuts will have to be substantial to make up for reduced penalty rates and higher private health insurance and electricity costs.

“Many ns will look at the net impact of the government’s policies and say they’re worse off,” he told reporters.

The promise of personal income tax cuts has been hinted at for months.

Mr Morrison warns tax cuts won’t be “mammoth”, but they will be affordable and aimed at low and middle-income earners.

It’s expected part of the tax relief will come through increasing the low-income tax offset.

Low to middle-income earners could be up to $10.50 a week better off from July 1.

Deputy Labor leader Tanya Plibersek ridiculed the speculated size of the tax cut, saying it won’t even be “a hamburger and a milkshake” reduction.

“You’ll have to take your pick – a hamburger or a milkshake,” Ms Plibersek told reporters in Canberra.

There is speculation reported the $87,000 income tax threshold will be increased to $90,000, benefiting all taxpayers above that level because of the progressive nature of the personal tax system.

Centre Alliance senator Stirling Griff believes there is a case for tax relief for middle to low-income earners.

But he is concerned there will be $65 billion less spent on community services over the coming years, from the government’s proposed corporate tax cuts coming into play.

“My concern is really the economy has moved positively in recent months, or so the stats have shown us, but I do have a number of concerns over the next 12 months,” Senator Griff said..

Tuesday’s budget could also return to surplus a year early, in 2019/20, thanks to a spike in company taxes and record job growth.

The budget will contain a road and rail infrastructure package, while Mr Turnbull has also flagged help for people dealing with high energy bills.

A significant aged-care package, after a major review into the sector, is also included.

Meanwhile, former Liberal treasurer Peter Costello has savaged the government’s budget strategy to pay down debt.

“It took us 10 surplus budgets to pay off last time,” he told Leigh Sales on ABC-TV’s 730 program.

“I think the probabilities are, we’ll never get back to where we were. You and I will die before that happens.”