Oil shock further reason for tax reform, spending cuts

Economic developments have heightened the urgency for budget reform, Treasurer Jim Chalmers says. (Mick Tsikas/AAP PHOTOS)

Politicians must resist the temptation to use a budget boon from the Iran war to pump the economy up with cost-of-living measures such as fuel excise cuts or energy rebates, economists say.

Repeating the approach of the post-COVID-19 pandemic inflation spike to ease price pressures on Australians would have the opposite effect, HSBC chief economist Paul Bloxham warned.