"The Treasury has not identified the dollar cost of that particular item," he said. "The cost of the plan is set out in the medium-term outlook and shows the budget returning to balance." Sky News political editor tackles Prime Minister Malcolm Turnbull on how much a cut to the company tax rate will cost the budget. Credit:Sky News But a well-placed government source indicated the 10-year figures were known, and that a Parliamentary Budget Office calculation released by Labor showing it would cost $16.5 billion in the year 2026-27 was incorrect. Mr Turnbull later told Parliament that Treasury had calculated the figure, but he declined to reveal it. He said a respected economist who estimated the 10-year cost at $55 billion "may or may not be correct", but he would not endorse the number. "The cost over the ten years has been calculated, taken into account by the Treasury, and built into their medium term projections," the Prime Minister said.

He said the budget papers historically did not identify the cost of line items 10 years into the future. That prompted allegations of hypocrisy from Labor, because the government earlier released 10-year Treasury modelling on its tobacco excise hike, and used it to rubbish Labor's own figures. Prime Minister Malcolm Turnbull during question time on Thursday. Credit:Andrew Meares Under the government's company tax plan, the tax rate on small businesses will decrease to 27.5 per cent, and the threshold to qualify for that lower rate will gradually increase to turnover of $1 billion. After that, the tax rate for all companies will be stepped down to 25 per cent. The budget's forward estimates show the policy will hit revenue by $5.3 billion over the next four years, but after that it is unclear. During an interview with the PM, Sky News host David Speers tried several times to elicit a specific dollar amount. "I don't understand what the cost is - what's it going to cost taxpayers to cut the company tax rate to 25 per cent?" he asked.

"What it ensures is that we'll have stronger jobs and growth," Mr Turnbull replied. "This is not a difficult question," Speers insisted to no avail. The stand-off even prompted Bill Shorten's press office to distribute a transcript of the exchange to the media. Labor also went to town against the government in Parliament. "The centrepiece of the budget and they forgot to cost it. Even Joe Hockey was more competent than that," said frontbencher Tony Burke, before he was gagged by the government. Deloitte Access Economics director Chris Richardson estimated the tax cut would hit revenue by $55 billion over the next 10 years. Mr Turnbull said Mr Richardson "may well be right", but warned that "the further out you forecast, there is more uncertainty".

The matter is significant because many economists argue Australia has a structural problem on the revenue side of the budget and have warned against tax breaks that would further decrease tax receipts. Labor has also sought to frame Treasurer Scott Morrison's first budget as one that rewards the big end of town, including high income earners, although the party would support a tax cut for businesses with turnover of less than $2 million. Follow us on Twitter