The Turnbull government wants to take a stab at reducing an estimated $22 billion in tax deductions for work-related expenses each year, and may consider introducing a standard deduction for all taxpayers or doing away with certain deductions in favour of lower tax rates.

A government inquiry pushed by Treasurer Scott Morrison has been examining whether a host of work-related tax deductions claimed by individuals every year could be scrapped or reduced, and instead replaced with low personal tax rates.

Mr Morrison last year asked his department to look into a universal cap on income tax deductions that would apply to work-related expenses, as well as housing tax breaks including negative gearing and the capital gains tax concession, which he later ruled out any changes to.

But it is believed there is still appetite for changes as soon as the May budget in relation to work deductions, which the tax man says are being over-claimed by millions of Australians.