Australia markets closed

Abbott, Shorten clash on tax cut plans

 

Labor insists it's offering genuine bipartisan support to give small business a bigger tax cut than the 1.5 per cent offered in the federal budget.

But Prime Minister Tony Abbott says Labor's just presented a budget wishlist and has dismissed the opposition proposal for a five per cent company tax break as an old, recycled policy.

Opposition Leader Bill Shorten used his budget reply speech to call on the government to take small business tax cuts further than planned.

Mr Abbott accused him of peddling false hope.

"They throw around these commitments but never actually deliver on them," the prime minister told 2GB on Friday.

"Last night it wasn't a plan, it was just a wish list."

Labor first proposed to cut corporate taxes by five points to 25 per cent in its mining tax package in 2010.

But Mr Abbott's then-opposition combined with the Greens to vote down that cut.

Mr Shorten said the 1.5 per cent cut was good for generating a headline but if you really wanted to have an impact on business confidence you had to go further.

"You can't just do this from opposition, you need a government to come to the party," he told reporters in Canberra.

"It sounds like Tony Abbott's a bit frustrated that we're engaging in the battle of ideas."