Expectations about the economy in a year's time fell to its lowest level in four years while confidence among those most likely to benefit from the tax cuts and lower interest rates - middle income earners and mortgage holders - all fell.

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"The fall in sentiment this month is troubling as it comes against what should have been a supportive backdrop for confidence," he said.

The government has been urging people to use the first stage of the tax cuts, refunds of up to $1080 for low and middle income earners, to spend them across the nation's retailers. The RBA has cut interest rates in a bid to drive down the unemployment rate which has inched up in recent months to 5.2 per cent.

The survey showed a 5.8 per cent lift in expectations of a higher jobless rate. It is now above its longer term average for the first time since mid-2017 with concerns about unemployment lifting sharply in NSW, Victoria and Western Australia.