National

Tax break priority post-election: Morrison

By AAP Newswire

Prime Minister Scott Morrison says passing laws to provide a better tax offset for 4.5 million Australians would be a priority if re-elected.

An independent budget update released on Wednesday, known as the Pre-Election Economic and Fiscal Outlook, confirmed one key aspect of the coalition's tax cut plan could not go ahead immediately without laws.

While many of the budget's tax measures could be legislated at a later time within 2019/20, the "immediate relief to low- and middle-income earners" component of government's personal tax plan "requires the relevant legislation to be passed before the increase to the low and middle income tax offset (LMITO) can be provided for the 2018-19 financial year", the report said.

"If not legislated prior to 1 July 2019, the revenue cost of this measure would need to be reassessed," the report noted.

The change is due to deliver an rise in the maximum benefit of the low and middle income tax offset from $530 to $1080 for singles or up to $2160 for dual income families for the 2018/19 to 2021/22 income years.

Labor seized on the report saying it showed that for two successive elections the coalition promised income tax cuts but found they could not be immediately delivered.

Mr Morrison told reporters in northern Tasmania after the report's release it was the government's intention to legislate.

"We would seek to legislate them at the earlier possible opportunity," Mr Morrison said.

PEFO, which gives a baseline to the parties as they make their policy promises, reiterated the budget forecast of a surplus of $7.1 billion in 2019/20, but slightly revised the deficit for 2018/19 from $4.2 billion to $4.3 billion.

The change reflected the $88 million cost of extending energy assistance payments to people on Newstart and some other types of assistance.

"The economic and fiscal outlook for the commonwealth has not materially changed since the publication of the 2019-20 budget," the 31-page report said.

It said since the budget the thermal coal spot price had been lower than assumed, but this has been "somewhat offset" by a higher-than-assumed iron ore price.

The oil and LNG price had also been higher than the budget assumption.

"Given short-term volatility and offsetting movements in individual commodity prices, these differences are judged not to give rise to a material change in nominal GDP," the report said, reiterating the 3.25 per cent nominal GDP forecast for 2019/20.