The Albanese government's first major federal budget must be "squarely focused" on lifting people out of poverty, according to the Australian Council of Social Service.
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ACOSS is calling for a fairer tax system ahead of the May federal budget, as part of a wishlist of recommendations on how to fund essential services, such as social security and public housing.
This includes axing stage three tax cuts, abolishing private health insurance rebates and fossil fuel subsidies, restricting investment property tax breaks and reducing Capital Gains Tax concessions.
Other recommendations include introducing a 15 per cent levy on post-retirement super earnings, a sugary drinks tax, an offshore gas royalty and to broaden the base of the Medicare Levy to ensure people contribute according to their capacity to pay.
ACOSS chief executive Cassandra Goldie said Australia was one of world's more wealthy nations, but had the ninth lowest tax rate, and was the sixth lowest in public spending.
Dr Goldie said one of the most effective things the federal government could do was to "properly strengthen our tax base" to address the "huge gap" in financing critical essential services.
"And so that's why we say this is a budget that needs to demonstrate that it's capable of being bold and active in dealing with these challenges," Dr Goldie said.
"Stage three cuts need to go. And the sooner that we get a government that comes out to say that, the better."
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ACOSS is calling for the budget to include lifting JobSeeker by $76 a day at a cost of $10.5 billion in the next budget, increasing rent assistance and building more social houses, as well as rolling out energy efficiency measures in low-income homes.
This week, the householders were warned to expect a further 23 per cent energy price hike in winter, which could add further stress to those already feeling the pinch.
Dr Goldie said 3 million people were living in poverty and were forced to choose between paying for essential items like food, energy bills or medicine. Ninety per cent of people on JobSeeker were in housing stress.
"That's where we're at, and we're not talking about a handful of people. This is severe and its large scale," Dr Goldie said.
"And so we think the best way to deliver on that is making sure that we can reduce the costs of accessing critical services like health and aged care through strengthening our tax and revenue base."
Federal energy minister Chris Bowen said the Treasurer Jim Chalmers is working through energy bill relief to be included in the next budget.
ACOSS also welcomed the federal government's Economic Inclusion Advisory Committee which was established last year by independent ACT senator David Pocock and Treasurer Jim Chalmers.
The committee will act as a sounding board before each federal budget, to advise the government on the effectiveness and sustainability of income support payments.
Dr Chalmers previously included a statement about placing a greater emphasis on people's wellbeing in last year's October budget.
"We certainly hope that that is a critical signal of where government wants to take its policies," Dr Goldie, who is also a Economic Inclusion Advisory Committee board member, said.
Dr Goldie said the outcome of last year's federal election proved there was a public will for these changes, in which voters were deciding on issues such as climate change, gender equality, and greater fairness.
"We've got an informed electorate that understands the current budget position that we are not a heavily taxed country. In fact, we're a very low-tax country," she said.
"It's time for people on higher incomes, and many of whom are absolutely up for contributing more, as long as we have an understanding of where that revenue would go."
