Govt eyeing plan for 'states income tax'

The government is reportedly considering a plan to allow states to levy income tax in a move the opposition says is desperate.

The government is reportedly considering a plan to allow states to charge income tax as they look for extra resources for schools, hospitals and other services.

Prime Minister Malcolm Turnbull and Treasurer Scott Morrison are meeting with premiers and treasurers in Canberra on Friday for COAG and Sky News reports that a scheme under which income tax is raised by states and territories will be put to the leaders.

Opposition spokesman Chris Bowen said the move indicates the government is desperate, adding "this is a Turnbull-Morrison fix that basically puts the responsibility of the $57 billion hospital's funding cut onto the states".