Treasurer Joe Hockey insists that an improving budget position provides scope to deliver his commitment to personal income tax cuts.
But Prime Minister Tony Abbott says Australians will have to wait until the run-up to the next federal election before they hear more.
"It's in our DNA to want to deliver further tax cuts and we will in the run-up to the election," Mr Abbott told reporters on Thursday Island on Tuesday.
Mr Hockey wants to cut personal taxes to address the growing problem of bracket creep, which pushes workers into higher tax brackets through wage inflation.
He says the government can afford the $25 billion revenue hole adjusting tax thresholds would create while keeping good on its promise to bring the budget back to surplus in 2019/20.
"The budget deficit is coming down and when I release the final budget numbers for the last 12 months, people will see actually we beat expectations," Mr Hockey said.
But the treasurer also has left the door open to funding the tax cuts by broadening the base of the GST to include health, drawing an attack from Labor.
Opposition health spokeswoman Catherine King argued that would amount to a GP co-payment by stealth, while Labor Leader Bill Shorten scoffed at the government's "economic formula".
"If you are sick and need to go to the doctor you pay extra tax, if you need to go to a hospital for your kids you pay extra tax, if you need bandages you pay extra tax," he told reporters in Brisbane.
Greens treasury spokesman Adam Bandt said the mooted tax cuts could mean the budget never returns to surplus.
"The government says it will get back to an early surplus, keep unfair tax breaks for the wealthy and reduce income taxes all at the same time," he said.
"It will have to cut services, lift other taxes or find a magic pudding."
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