Prime Minister Kevin Rudd has seized on a report that shadow treasurer Joe Hockey hasn't ruled out a change to the goods and services tax.
Mr Rudd said it appeared the opposition was going to increase the scope of the GST to include food to pay for a $70 billion shortfall in funding for its policies.
"A goods and service tax increase seems to be the hidden part of the agenda about how they bring these things together," he told reporters in the western Sydney electorate of Greenway.
The Australian Financial Review reported that Mr Hockey said a GST hike was "part of the equation" to simplify the tax system.
Mr Hockey and shadow assistant treasurer Matthias Cormann on Wednesday categorically ruled that out, and said the report was wrong.
"... we never said we would increase GST. The AFR headline is false and the story misinterprets my words from a presser. They alone did it," Mr Hockey tweeted.
But Mr Rudd said changing the GST "is now on the Liberal party agenda".
"What we're seeing through multiple statements now by Mr Hockey ... and others is that the goods and services tax is now increasingly on the agenda," he said.
"I think this is a big, big development in this election campaign."
Mr Rudd said his government would never increase the GST or extend it to food.
"What I would say loud and clear that the Australia government I lead would not increase the gst nor would it extend its scope. That is clear cut language."
