And Mr Albanese has dismissed concerns that the government's revised tax cuts could cause the central bank to delay any easing of monetary policy.

While acknowledging the RBA's independence, the prime minister told ABC radio that "I, of course, would like to see cuts to interest rates".

"I'd like to see any measure that takes pressure off low and middle income earners."

Queensland premier Steven Miles was even more forthright, tweeting that "the Reserve Bank needs to start cutting interest rates now to take pressure off households".

The central bank board meets first the first time in 2024 on February 5 and 6, and is widely tipped to hold the official cash rate steady at 4.35 per cent.

But there is mounting speculation the RBA will begin cutting interest rates later this year following evidence that inflation is decelerating sharply.

After the Australian Bureau of Statistics reported that annual headline inflation slowed to 4.1 per cent in the December quarter, investors brought forward their rate cut expectations.

Markets think a May rate cut is a better-than-even chance and have fully priced in a reduction to 4.1 per cent by July.

Deutsche Bank chief economist Phil O'Donaghoe said a May rate move was "a material possibility".

Mr O'Donaghoe said the speed with which underlying inflation slowed late last year could, if sustained, convince the central bank to ease in just three months' time.

He said the monthly trimmed mean measure of inflation fell 1.3 percentage points in the last two months of 2023 and if that continued in the first two months of this year it would drop to 2.7 per cent, within the Reserve Bank's 2 to 3 per cent target band.

The Deustche Bank economist said his base case remained that cuts would be delayed until the second half of the year but "a rate cut in May is a material possibility".

Investors expect at least one more cut before the end of the year and are betting on the cash rate dropping to around 3.5 per cent by mid-2025.

AMP Investments chief economist Shane Oliver, who predicts rates will start to come down from June, warned the government's tax changes increased the risk that inflation would stay higher for longer and potentially delay any easing of monetary policy until August or later.

Mr Oliver said the aim of the government's tax package was to increase the amount of relief going to lower and middle income earners to help ease living cost pressures.

"That will have some impact on spending," the AMP economist said. "It may be fairly minimal, but it is coming at a time when the overall policy focus should be on getting inflation down. I think it was a fairly risky move on the government's part."

But asked if the government's tax changes could delay interest rate relief, Mr Albanese replied with an emphatic "no".

"That is precisely what Treasury have said. This will not have an inflationary impact," the prime minister said.

While those on low and middle incomes were more likely to spend the extra tax relief they receive, this would be offset by the fact the changes will encourage more people to enter the workforce, he said.

The revised tax package needs to be approved by parliament and if the Opposition decides against supporting the change the government will need to secure votes from the Greens and crossbench MPs.

Finance Minister Katy Gallagher said she was "hopeful" that the Coalition would back the revised tax cuts because "I don't think any parliamentarian should be standing in the way of people getting more money in their pockets".

Senator Gallagher said she had already had "some discussions" with the Greens and would also be talking with independent ACT senator David Pocock and Tasmanian independent Jacquie Lambie.

But she reiterated the government's determination to have its tax changes passed without amendment, saying that "we think this tax package stands on its own".

Opposition leader Peter Dutton, meanwhile, has seized on the government's decision to break its promise on the stage three tax cuts to warn it may also be contemplating changes to capital gains tax and negative gearing arrangements.

"I think the debate now is about what comes next because Jim Chalmers, when you look at his words, has got this cute form of words around negative gearing and dividends and the family home," Mr Dutton said.

"People could reasonably say ... they're worried the changes are coming. It's an attack on aspiration."

Treasury has released analysis showing the enormous cost of tax breaks including on superannuation contributions and earnings, capital gains tax concessions and negative gearing.

Tax concessions on superannuation contributions and earnings will top $56 billion this financial year, while capital gains tax concessions and discounts will cost the budget in excess of $66 billion and negative gearing claims $27.1 billion.

In each instance, the vast bulk of the benefit accrues to those earning more than the median wage, particularly high income earners, the Treasury analysis shows.