Prime Minister Malcolm Turnbull has put any changes to the GST on the political back burner, ruling out changes to the consumption tax for at least three years if his government is re-elected.
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Ahead of Tuesday's federal budget - and an expected visit to Government House by the end of the week to ask the Governor-General to call an election for July 2 - Mr Turnbull also foreshadowed "substantial" tax changes.
And the Prime Minister has declared his government will be judged by voters on its "new agenda" at the election - rather than being bound to all of the promises made by former Prime Minister Tony Abbott.
"I can give you this absolute undertaking, there will be no change to the GST in the next parliament," he told Sky News.
"We are not fiddling, this is going to be a critically important document... all of the other measures that we have proposed are vitally important, but obviously the tax changes had to await the budget.
"There is substantial tax reform, tax changes in the budget. Yes, we will be going to an election on July 2 and that will go to an election, unless the measures are passed before the Houses are dissolved."
The Coalition is expected to hike tobacco taxes and to reduce superannuation tax concessions for the well-off in Tuesday's budget, while a cut to company taxes is also in prospect.
Other measures expected in the budget include a $5 billion dental plan, additional funding for corporate regulator ASIC and end to the temporary budget repair levy for people earning more than $180,000 will all be confirmed.
There will also be an additional $1.2 billion for school funding, students face the prospect of paying more for their university degrees – and having to pay back their debt sooner while an extension of the $20,000 instant asset write-off for small business is in prospect.
Reflecting on the decision to abandon a possible rise in the GST to 15 per cent, Mr Turnbull dismissed suggestions the federal government had "given up" on tax reform after looking "very carefully" at the GST.
"If you were to increase the GST by 50 per cent, to 15 per cent for example, you would raise about an additional $30 billion a year. About $6 billion of that would go in automatic indexation of pensions and benefits, so you'd have $24 billion left," he said.
"But here's the catch, at that point 91 per cent of people in the bottom 20 per cent of incomes, and about 74 per cent of people in the second bottom quintile would be worse off.
"So we looked at the distributional analysis, we saw that by the time you had compensated people in the two bottom quintiles, the bottom 40 per cent of incomes, what you had left over to go for personal income tax cuts or company tax cuts was a relatively modest amount given the scale of the change proposed."
The federal budget would focus on supporting jobs and growth - a familiar refrain from the prime minister and his front bench - while setting up the tax system to be "sustainable" and "fit for purpose in 2016 and the years ahead".
Pressed on whether he was bound by all of the promises made by Mr Abbott - such as not changing the tax arrangements for Australia's super system - Mr Turnbull said that on the eve of an election "what we are setting out is an economic plan for voters to approve or not at the 2016 election".
"This is submitting a new agenda, this is not Tony Abbott's plan, it's the plan of the Turnbull government."
Labor has already promised to make changes to both tobacco taxes and superannuation and Mr Abbott has criticised these changes in that context, while also arguing that the Turnbull government's agenda is essentially the same as his own.
