Australians won't spend an extra cent on the Medicare levy as the Turnbull government promises to scrap a proposed $8 billion increase it says is no longer needed to fund the National Disability Insurance Scheme.
The increase, a signature measure of the 2017 federal budget, was to cover the costs of the NDIS.
However the treasurer says better than a expected economy means the increase won't be needed.
Tax receipts up until February are expected to have run $4.8 billion higher than estimated in December, due to company profits, temporary commodities boost and a jobs boom.
"We are now in a position to give our guarantee to Australians living with a disability and their families and carers that all planned expenditure on the NDIS will be able to be met in this year's budget and beyond without any longer having to increase the Medicare levy," he will tell business economists on Thursday.
"The reason we proposed to increase the Medicare levy was only to fully fund the gap left behind by Labor on the NDIS.
"We no longer believe we need to do this."