Small and medium businesses may reap the benefits of tax cuts sooner than expected, with the federal government dumping a plan to slash taxes for bigger companies.
Malcolm Turnbull scrapped the government's controversial plan to cut the corporate rate for big businesses from 30 to 25 per cent on Wednesday.
"We will not be taking the tax cuts for larger companies to the next election," he told reporters in Canberra.
Instead, he said the government will look at bringing forward already legislated cuts for businesses turning over up to $50 million.
The prime minister lamented the end of bipartisan support for cutting company tax, after legislation was defeated in the upper house with minor parties supporting Labor in opposing the plan.
Finance Minister Mathias Cormann made a failed last-ditch attempt to drum up key crossbench support by carving out Australia's big four banks.
But that didn't win over One Nation, Centre Alliance and independent Tim Storer.
Labor will eventually come around to the idea, Mr Turnbull later suggested.
"Australia needs to have competitive taxes. There is no question about that," he told parliament during question time.
The business community is certainly hoping they will, according to Australian Chamber of Commerce and Industry chief executive James Pearson.
But such a turnaround doesn't seem likely after comments from shadow treasurer Chris Bowen.
"They had a bad idea and they have failed in implementing that bad idea," he told reporters.
