Scott Morrison has secured a major victory on income tax cuts, with the government securing the crossbench support it needs to pass its full $158 billion package.
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Tasmanian senator Jacqui Lambie has agreed to back the plan, after demanding Tasmania's $157 million public housing debt be wiped.
The senator is still ironing out a deal on the issue, but says she will back the tax cuts in good faith.
"With that deal, I still need some more time so we can iron this out properly," she told ABC Radio on Thursday.
Centre Alliance - which carries two votes - has also confirmed it will back the full tax package.
The South Australian party has struck a deal to keep rising gas prices at bay, ensuring the tax relief isn't chewed up by power costs.
"It is Christmas for voters in South Australia and Tasmania," Centre Alliance Senator Rex Patrick told Seven's Sunrise program.
Former Liberal senator Cory Bernardi had always backed the full package.
This means the government, which needed the support of at least four crossbenchers to get legislation through the upper house, is in the box seat to see it passed.
The first stage of the tax plan will deliver up to $1080 to low and middle-income earners when they lodge their tax returns for 2018-19.
The second stage delivers a 19 per cent tax rate from 2022-23 to people earning up to $45,000.
The final stage due in 2024-25 flattens the tax rate to 30 per cent for people earning between $45,000 and $200,000.
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Labor wanted the crossbench to bring the second stage forward and leave the third stage for later.
It had argues the third stage was too far off for the parliament to decide on.
Shadow treasurer Jim Chalmers says Labor is still focused on getting its amendments through, but will look at its next steps.
"We'll have the appropriate discussions and we'll have more to say about it later today," he told ABC TV.
AAP
