Prime Minister Tony Abbott has ruled out increasing taxes to pay for Australia’s military operations in Iraq.

Mr Abbott says his government is about lower, not higher taxes.

Taryn Watt reports.

TRANSCRIPT

Tony Abbott is remaining tight lipped as to whether the budget has improved or worsened since the coalition came to power.

He says the budget is more honest than it was under the previous government and every forecast Labor made was wrong.

Tony Abbott, Prime Minister: “We don’t cook the books, we are going to make careful and cautious predictions. We are not going to make inflated and over optimistic predictions.”

Mr Abbott ruled out increasing taxes to fund the cost of national security and Australia’s involvement in Iraq.

His finance minister refused over the weekend to rule out hitting taxpayers for the estimated $500 million a year in extra costs.

The Prime Minister says his government believes in lowering taxes.

The coalition also defended its decision not to force job seekers to apply for 40 positions a month.

The increase was widely criticised as punitive for job seekers and an administrative nightmare.

Eric Abetz, Liberal Senator for Tasmania: Our government is not either soft nor hard it is being reasonable to ensure that job seekers do everything they possibly can to get a job.”

Newstart recipients, however, must still apply for 20 jobs a month.

Mr Abbott says the budget will be back in “broad balance” in 2017/18 with “careful and cautious” predictions.

Taryn Watt, QUT News.