Australia budget: Election looms large as Morrison prepares to deliver
Australia budget targets multinationals
(about 5 hours later)
Australian Treasurer Scott Morrison is set to announce the budget on Tuesday, which will double as the unofficial start of an election campaign.
Multinational companies that move profits offshore to avoid tax will be penalised under new measures in Australia's budget.
Small tax cuts and spending on health, infrastructure and education are likely to be part of Tuesday's package.
Treasurer Scott Morrison's first budget doubles as the government's sales pitch for an early election on 2 July.
The cost of these will likely be offset by pension changes and closing tax loopholes for multinational companies.
It also outlined a series of cuts that will take the company tax rate from 30% to 25% by 2026.
The budget is expected to form the backbone of the Liberal coalition's manifesto for an election.
The budget also contained a small tax cut for Australians earning more than A$80,000 per year.
Meanwhile Australia's Reserve Bank cut interest rates by 0.25% to a historic low of 1.75% on Tuesday in a bid to fight deflation.
"This cannot be just another budget because these are extraordinary times," Mr Morrison said during his address to parliament.
Prime Minister Malcolm Turnbull has said he will dissolve both houses of parliament after the budget and call an election by 11 May. Australia will almost certainly go to the polls on 2 July.
"Australians have clearly said we must have an economic plan to make this period of transition a success."
The opposition Labor party says the reforms - also believed to include a hike in tobacco prices and pension concessions for the wealthy - are too modest and favour the rich. It has been piling on the pressure with a raft of populist policy suggestions, say analysts.
The budget's measures were relatively modest and most were known in advance of the budget speech.
Analysis: Shaun Davies, Australia editor, BBC News website
For a moment on Monday, Mr Morrison appeared to forget the date for his own budget, insisting in parliament it was two days away.
He might well be wishing he had 24 hours up his sleeve. A lot is riding on his economic plan, which doubles as the government's pitch to voters. As the official announcement of an early election draws near, the resurgent opposition Labor Party has been piling on pressure with its populist policies.
It appears this year's budget is about two things: neutralising Labor's lines of attack for the election, while emphasising a few key differences that play up the government's economic management credentials.
Of course, there are also the minor issues of setting up Australia's economy for future prosperity and reducing a ballooning deficit.
Five things to watch on Australia's budget day
The budget announcement begins at 19:30 AEST (10:30 GMT) - the treasurer and the prime minister say it will create additional jobs and grow the economy.
The government will create a A$5bn (US$3.8bn; £2.6bn) fund for critical infrastructure in cities, Mr Morrison announced on Monday.
There will almost certainly be small cuts in the company tax rate and those earning more than A$80,000 will also benefit as the earning threshold for the second-highest tax bracket is pushed higher.
Additional spending on health and education is also being promised, but at more modest levels than in the opposition Labor party's proposals.
Labor has already announced a number of policies, including a plan to end "negative gearing" tax concessions for property investors buying existing homes that would raise money to pay for its spending.
The government opposes Labor's policy to end negative gearing and says it will cause house prices to crash.
