The government has raised the prospect of increasing taxes if Labor and the Senate crossbench continue to obstruct its cuts to family tax benefits, paid parental leave and unemployment payments.
Treasurer Scott Morrison and Finance Minister Mathias Cormann have made the threat as the $4 billion "omnibus" bill, the savings of which they have linked to funding of the National Disability Insurance Scheme, appears to have failed to attract the necessary support in the upper house.
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Government hints at tax rises
If savings measures aren't passed, Finance Minister Mathias Cormann says the government will have to look at other options to repair the budget. Courtesy ABC.
"If you don't [make savings], you've either got to have higher debt, which is a tax on your children, or you have to deal with other revenue measures," Mr Morrison told Sky News on Tuesday night.
The comment was echoed by Mr Cormann, who described tax increases as "not what we would like to do" but potentially "the only thing that we are able to do at the end of the day" if Labor maintains its opposition.
"Our preference is to legislate the savings that are reflected in our budget," he told ABC.
"Obviously, in the final analysis, if the Parliament were not to pass spending reductions, if the Parliament were not to legislate savings, then we need to ensure that we bring the budget back to balance and that we pay for government spending then, of course, tax increases become the only option."
Prime Minister Malcolm Turnbull said it was a "penetrating glimpse of the obvious" that "those who oppose savings measures are by definition supporting tax increases, if you assume that they want to bring the budget back into balance".
The government argues that the NDIS was an "empty promise" not fully funded by the former Labor government.
Shadow treasurer Chris Bowen accused Mr Morrison of having a "massive tantrum" in response to its Senate difficulties.
The pathetic irony of the government threatening tax rises when they are also promising a $50 billion tax cut for big business seems to escape this government," he said.
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