Malcolm Turnbull is deciding whether to dump his company tax cut plan as pressure mounts from worried Liberals to axe the controversial policy.
Labor’s victories in two marginal by-elections on the weekend has concerned coalition MPs, with one calling for the government to drop the tax plan.
“I don’t know why we would take it to the next election, quite frankly, if we can’t get it through the Senate now,” Liberal MP Luke Howarth told Sky News.
“They need to sort this out fairly quickly. If it’s not going to be passed it’s not going to be passed, the government should drop it and move on.”
Mr Howarth is among Queensland MPs concerned about the damage the policy is doing to the government’s vote in the state where Labor comfortably won the seat of Longman on Saturday, .
Labor leader Bill Shorten, pumped up after the by-election success, said Mr Turnbull should drop the tax cuts on the way out of office.
“He needs to drop them and then he needs to leave the keys to The Lodge and then he needs to go,” Mr Shorten told the Nine Network on Monday.
Tasmanian Liberals believe Labor’s message that corporate tax cuts would take money from schools and hospitals hurt the government in the closely-run Braddon by-election.
It’s understood there is widespread support within the coalition party room for the tax cuts to go to the senate and then dropped if they fail to go through.
Mr Turnbull is still committed to the tax cut plan, but he has stopped short of recommitting to take the policy to the next election.
The prime minister said the government would look “very seriously and thoughtfully and humbly” at the response from voters in Saturday’s by-elections.
Susan Lamb’s Longman win, with an expected 54 per cent of the two-party preferred vote, came on the back of a One Nation drain of LNP votes.
A similar swing at a general election could threaten senior government figures, including Home Affairs Minister Peter Dutton.
Finance Minister Mathias Cormann will bring the tax legislation to a vote in the Senate in the next sitting fortnight.
When asked if the government would take the tax cuts to the next election if the bill is defeated, he replied: “that is our position”.
Liberal backbencher Julian Leeser told AAP the coalition should stick with the tax cuts as they are part of the government’s plan to grow the economy.
Former prime minister Tony Abbott said while he accepted the case for company tax cuts, they were not a vote winner and there was no point in putting them off.
Labor retained the marginal federal seats of Longman and Braddon in Tasmania, despite months of hard campaigning by the Liberals, who also failed in Mayo.