$158 billion tax cut package in limbo: Will Pauline Hanson or Labor backflip to pass the cuts?

Pauline Hanson could derail the government’s $158 billion income tax cut package, the key promise made in its election campaign.

The One Nation leader carried two Senate votes which could be crucial to passing the package.

She says she will not support the package unless she gets a coal-fired power plant, a 1930s scheme to divert water inland, and a royal commission into family law.

Chris Ulhmann, Nine News’ political editor, said Ms Hanson’s requests are unrealistic.

“Her rough calculations yesterday were that two of those things would cost $25 billion.

“I don’t know the government has that kind of money … particularly as it wants to put forward $158 billion worth of tax cuts,” he told 3AW Breakfast.

Mr Ulhmann said it’s still possible the One Nation leader may backflip on her requests.

“As you know with Pauline Hanson, she may well change her mind,” he said.

There is also a possibility that Labor may shift to support the government’s tax cut package.

“You’d think that they should,” Mr Ulhmann said.

“There will be some in the party’s ranks who say ‘let’s just pass this and move on’, but whether they’re the loudest voices on it, we’ll see.”

Labor currently supports the first stages of the package but is against the later stages of the package, which overwhelmingly benefit high income earners.

The Coalition is on track to hold 35 seats in the Senate when parliament returns next month.

It needs 39 votes to secure the majority needed to pass legislation.

Press PLAY below to hear more.