Malcolm Turnbull

Budget surprise, even for the treasurer

Malcolm Turnbull has brought forward the budget to May 3, a week earlier than previously scheduled. (AAP)

The budget will be brought forward a week to May 3 ahead of a possible double dissolution election on July 2.

The timing of Prime Minister Malcolm Turnbull's announcement that the budget would be released a week early on May 3 was a surprise to everyone, even the treasurer.

An hour before the prime minister's declaration, Scott Morrison had told Sydney radio the budget would be on May 10 as scheduled.

Mr Turnbull then held a cabinet phone hook-up minutes before announcing his decision.

"May 10, that's what it was until I was advised this morning that it will be on May 3," Mr Morrison later told reporters in Sydney on Monday.

The earlier date gives the prime minister time to clear the decks for a double dissolution election on July 2, if the Senate fails to pass legislation reinstating the building industry watchdog.

It also allows the opposition leader time to give his budget-in-reply speech and for interim budget bills to be passed.

It will be the first budget to be brought forward in over 60 years.

Shadow treasurer Chris Bowen said politics is being put ahead of policy.

"Malcolm Turnbull's decision to bring forward the budget is all to do with politics and nothing to do with the economy or tax reform," Mr Bowen said in a statement.

Market Economics managing director Stephen Koukoulas said voters would get pretty sick of what is effectively a 15-week election campaign.

"It can't be a stimulus for optimism," Mr Koukoulas told AAP.

The budget will contain the government's tax package which is looking increasingly likely to contain a cut in the company rate cut tax rather than once-promised personal income tax reductions.

While Mr Morrison avoided confirming that was the case, he did say the government had to do things that drove investment.

"If we don't drive investment, we can't drive growth and that means we can't drive jobs," he said.

There wasn't a lot of room in the budget and when the government opted against raising the GST rate it meant the opportunity for major changes in income tax were "largely removed".

"You can't pay for something with nothing," Mr Morrison said.

Australian Chamber of Commerce and Industry spokesperson Patricia Forsythe said addressing corporate tax is crucial to maintaining living standards.

Mr Morrison also defended a decision to end the tax levy on high-income earners next year.

The two per cent impost on people earning more than $180,000 was introduced in the 2014/15 budget in a bid to reduce the budget deficit, but Mr Morrison said it was always going to be temporary.

Stay up to date with SBS NEWS

  • App
  • Subscribe
  • Follow
  • Listen
  • Watch