Australian Treasurer Jim Chalmers has signalled that further income tax cuts are likely at the next election, as he prepares to release a 40-year Intergenerational Report forecasting Australia's economy through 2066. The government argues that recent tax reforms and an improved budget position have created room for additional tax relief to ease pressure on workers, reflecting its strategy to support living standards whilst managing long-term economic challenges.

The government has already delivered multiple tax cuts this year: a new $250 tax offset taking effect from 2027–28 and a rate reduction from 16% to 15% on income between $18,201 and $45,000 implemented from July 1. The report predicts that workers will shoulder two percentage points less of the personal income tax burden by the end of the medium term, with further reductions expected as property investment and capital gains are taxed more heavily. However, independent economist Saul Eslake expressed scepticism about the productivity growth assumptions underlying the budget forecasts, whilst Opposition Treasury spokesman Tim Wilson criticised the government's property taxation changes as damaging young Australians' home ownership prospects. The report will also highlight Australia's demographic pressures, with the fertility rate projected to decline to 1.34 children per woman by 2066.