The political debate over tax is raging in Canberra, and the battlelines have been drawn.

Striking a balance between equity and incentive in tax is always difficult — but both sides claim they have the mix right.

So who pays tax in Australia, and how much? And what does the debate mean for taxpayers?

One thing is for sure: the tax burden on Australia's highest wage earners will increase no matter who is in Government.

Opposition Leader Bill Shorten has promised to stop "millionaires" getting a tax cut, declaring he'll only support an increase to the Medicare levy for those earning more than $87,000.

He has also vowed to keep the temporary deficit levy for Australia's highest earners, effectively setting the top tax rate at 49.5 cents in the dollar, which is higher than the Coalition's 47.5 per cent.

It is an attempt to reclaim the moral high ground of "fairness" with his tax plan at a time of low wage growth and a ballooning national deficit.

But it's not just millionaires who will be hit by Labor's tax plan.

Australian Tax Office data shows 80 per cent of Australians earn less than $80,000 but contribute about 30 per cent of the Commonwealth's income tax take.

Those who earn more than $80,000 contribute almost 70 per cent ($122 billion) of the overall $177 billion tax pie.

Around 11,000 Australians earned more than $1 million in 2014-15 and collectively paid $11.1 billion in tax.

Taxable income Individuals Net tax $80,000 or less 80% 29.9% ($55 billion) $80,000 or more 20% 69.1% ($122 billion)

Mr Shorten says Labor cannot support making people on modest incomes pay more tax.

"Especially when this budget is going out of its way to give taxpayer money to millionaires and multinationals," he said.

Treasurer Scott Morrison has warned Labor's policy "will resign the economy to ruin" and effectively force people to work one day for the country and one day for themselves.

The Coalition is planning to hike income taxes across the board, through an increase in the Medicare levy, and it too argues this is fair because the revenue will be used to fully fund the $22-billion National Disability Insurance Scheme.

There is a glimmer of hope for taxpayers though: both parties have promised to consider income tax cuts once the budget returns to surplus.