Next month's federal budget is set to be one of the toughest in years, against a backdrop of plummeting taxation revenues and an economy tipping into recession.

"Longer term, you have to look at what can be afforded by way of additional support from those who are better off," Mr Rudd told Fairfax Media's 3AW, without elaborating.

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"Our discipline is don't allow taxes to get out of control, because you don't want to strangle an economic recovery. Within that, then of course it's always possible changes in the taxation mix," he added.

Britain's Labour government this week raised marginal taxes to 50% for earners of more than 150,000 pounds ($306,000) a year as it forecast the recession-hit economy would shrink by 3.5% this year.

Rudd's Labor, which faces re-election next year in the wake of what most economists predict to be a relatively mild recession in Australia, has promised more than $52 billion in cash and infrastructure spending to soften the impact.

He has also vowed to raise pensions.

But a newspaper report on Friday said the May 12 budget may forecast debt levels to reach $300 billion, equivalent to about 30% of GDP, jeopardising Australia's triple-A credit rating and threatening higher interest rates.

Finance Minister Lindsay Tanner has said the government will have to consider whether its $200 billion borrowing ceiling is sufficient, given the loss of $115 billion in government revenue since the economic slowdown hit last year.

Mr Tanner today said the budget would include deficit and debt forecasts for the next four years and beyond.

The country has kept its outstanding debt steady at around $50 billion for the past five years, although the government's debt manager expects it to reach $200 billion in the years ahead amid a spike in borrowings to offset the revenue shortfall.

Rudd said he did not see a need for the cap to be raised at present, but stressed it would depend on tax revenues as the downturn spiral continued, bringing unemployment to official forecasts of 7% or higher. Unemployment now stands at 5.7%.

"We don't see the need for that at this stage, but we are very concerned about what happens in the future about further collapses in taxation revenue. That is the key variable here," he said.