ACTU president Sharan Burrow said the tax cuts were not large enough to cover rising costs and the impact of the government's
Work Choices reforms, which remove penalty rates.
"The meanest industrial laws in 100 years and $7 to $10 in tax relief for those working families most in need, while $93 a week (in cuts) for the top end of town - unbelievable," Ms Burrow said.
Ms Burrow said the latest interest rate hike had cost families about $70 a month, the petrol price rise had added about $40 a month to the family budget and child care fees cost an extra $100 a month.
"For working people and their families it's a budget that simply again says John Howard and Peter Costello, whether it's IR laws or whether it's tax relief in the face of crippling cost pressures, simply don't care," she said. "This is clearly a double whammy."
Business welcomes budget
The government has made a good start on tax reform but more needs to be done, the Business Council of Australia says.
Council president Michael Chaney said the $37 billion in income tax cuts, and $4 billion in business tax relief, were sound and would help the economy. But there had to be more changes in coming budgets.
"There is no better time than now for Australia to make the strategic decisions and investment needed for future growth," he said.
"Many of the initiatives are sound responses to immediate pressures on our economy and its competitiveness, but over the next 12 months it will be imperative to achieve greater progress toward more permanent, structural changes to the economy."
Mr Chaney said the business community continued to underpin the budget with strong business tax receipts. But he warned this might not last.
"The question is whether this level of revenue growth can be continued, and spending at current rates sustained when the evidence points to the fact that important areas of our tax system - including Australia's business tax regime - are becoming uncompetitive," he said.