The government has launched its re-election bid with a federal budget that hands out $140 billion in income tax cuts over the next decade, locks in a surplus within three years and forecasts a drastic reduction in debt before 2030.

The tax cuts, the centrepiece of Scott Morrison's third budget, will be rolled out in three phases over seven years. They will culminate on July 1, 2024 with the abolition of the 37 per cent tax bracket and result in 94 per cent of the workforce earning between $41,000 and $200,000 paying just 32.5 cents in the dollar.