Prime Minister Tony Abbott is under pressure from Liberal backbenchers to consult more over proposed budget measures.
Liberal backbenchers are revolting over a proposed new levy on high-income earners as federal cabinet meets to iron out final details of the budget.
Prime Minister Tony Abbott will meet with his cabinet ministers in Canberra on Wednesday, less than a week out from Treasurer Joe Hockey delivering his first budget on May 13.
Brisbane MP Teresa Gambaro has written to Mr Abbott to express concerns, which she says are shared by other backbenchers, that MPs were not consulted on controversial measures.
“We did not go to the Australian people with this levy,” Ms Gambaro told ABC radio on Wednesday.
“I really believe it’s a breach of promise and I can’t support it.”
She said the levy would hit business confidence and make employers less willing to hire.
“I was never asked about this as a member of the party room,” the MP said.
Ms Gambaro said there were also concerns about the $22 billion paid parental leave scheme, which many coalition MPs believed was too costly.
That scheme, too, was announced by Mr Abbott without consulting his party colleagues.
Liberal frontbencher Jamie Briggs said Ms Gambaro should reserve judgment until Tuesday.
“It seems a little pre-emptive for her to be commenting publicly … about something she doesn’t know the detail of,” he told Sky News.
Cabinet discussions will focus on deficit levy, which is expected to temporarily raise the highest income tax bracket to try to raise about $8 billion over four years.
Business Council of Australia chief Jennifer Westacott said an effective top income tax rate of 50 per cent would be a disincentive and spending cuts should be considered before tax hikes.
There is speculation the government will go ahead with a $4 billion corporate tax cut and a new $5 billion infrastructure program on top of existing spending.
Fairfax Media reported on Wednesday the government had agreed to phase out the 38 cents a litre ethanol production subsidy.
But if the subsidy is abolished, the excise on locally produced ethanol will likely be cut by more than 20 cents a litre, while the full 38 cents a litre would still apply to imported ethanol.
The change would save the budget up to $1 billion over four years.
Meanwhile, trade unions say they are being denied a place in the Parliament House budget lock-up that allows stakeholders to peruse the budget papers before its release.
The move was “unprecedented” in the history of the federal budget, several unions said in a joint statement.
ACTU officials are being allowed in, but in smaller numbers than previous years.
The government says the stakeholder lock-up is about a third smaller this year and unions aren’t being singled out.