UPDATED 7.28AM The Australian Government has vastly boosted its firepower against multinational tax avoidance.

Treasurer Scott Morrison delivered his first Budget last night.

LISTEN ABOVE: Tax director at PricewaterhouseCoopers Geof Nightingale speaks to Mike Hosking

The Government hopes to raise up to $4.35 billion over the next four years through measures that include a new taskforce led by the ATO, steep penalties for tax dodgers and tighter rules to close loopholes.

He said the task force of more than 1000 specialist staff will "police and prosecute companies, multinationals, and high-wealth individuals not paying the tax that they should".

A new diverted profits tax will impose a 40 per cent penalty rate on multinationals attempting to shift their Australian profits offshore.

It's based on Britain's "Google tax" which targets multinationals that avoid paying tax by shifting profits to lower taxing countries.

"We will also strengthen the protections for whistle-blowers," Scott Morrison said. "You come forward and report tax avoidance and we'll increase penalties for multi-nationals that fail to meet their compliance and disclosure obligations to the ATO."

Corporate giants including BHP Billiton have been identified as using so-called marketing hubs in Singapore to help reduce their tax bill in Australia.

There is also tax relief for Australia's middle income earners with the tax bracket of 37 per cent now kicking in at $87,000 a year.

Some economists argue more should have been done to help lower income workers, but Scott Morrison disagrees.

"This is not a time to be splashing money around or increasing the tax burden on our economy, or on hard-working Australians and their families. Such policies are not a plan for jobs and growth."

However, Australia's Labor Party has labelled plans to cut the company tax rate for businesses within ten years, a joke.

The Budget has delivered good news for companies with a turn over of less than $10 million, with the tax rate to drop to 27.5 percent.

But Shadow Treasurer Chris Bowen said it goes too far.

"We will not support gradually increasing the threshold until it reaches a billion dollars."

Smokers in Australia will also feel a widening hole in their pocket.

The Budget targets smokers with an annual 12.5 percent increase in tobacco tax over the next four years.

"With the first increase to take effect on 1 September 2017. The net impact of tobacco measures will raise $4.7 billion over the next four years," Mr Morrison said.

Meanwhile, Scott Morrison has outlined incentives for employers and young job seekers to increase employment.

The Budget announcement includes a job readiness programme and internships with businesses over three stages.

Mr Morrison said job seekers will receive $200 a fortnight on top of their regular income support payment while participating in the internship.

And employers will receive an initial up front payment of one thousand dollars.

"In stage three, Australian employers will be eligible for a youth bonus wage subsidy of between six and a half and ten thousand dollars. These subsidies are just a smarter way of leveraging what you'd otherwise spend on Newstart and other welfare payments," he said.