Business tax cuts will be a key political battleground when parliaments sits for the first time in 2017 next week.
Prime Minister Malcolm Turnbull devoted much of an address to the National Press Club on Wednesday to promoting the virtues of the government's $50 billion 10-year plan to incrementally reduce the company tax rate from 30 per cent to 25 per cent.
However, he conceded there was no room in the budget for personal income tax cuts at this stage, but promised to reduce them when affordable.
Mr Turnbull is eager to push ahead with the first stage of the tax plan which would reduce the company rate to 27.5 per cent for firms with a turnover of less than $10 million.
Labor is against the plan, saying the cuts are unaffordable when there are other priorities in health and education.
But crossbench senator Nick Xenophon says his team will support the first increment, although is yet to be convinced larger businesses need a tax cut.
Treasurer Scott Morrison insists the present business tax rate is uncompetitive and will make it harder to attract the investment needed to expand, employ more staff and trade the nation's wares abroad.
"The economic burden of company tax falls mostly on employees through lower real wages," Mr Morrison says.
"Reducing company tax will support job security, wages and employment growth, as well as improve living standards."
