Prime Minister Malcolm Turnbull is seriously considering a radical change to the superannuation system in a move that could save the budget $6 billion a year and help his government prosecute its tricky reform ambitions with minimal political pain.

Shortly after confirming that tax reform will be the centrepiece of his first budget as Prime Minister, Mr Turnbull on Friday denied he was planning to stop a rise in the compulsory super guarantee to 12 per cent, saying his government had made "no proposal" to do so.

But Fairfax Media understands Mr Turnbull is very interested in a different superannuation proposal, as he continues his search for big budget savings.

The plan being considered would make tax incentives for contributing to super the same for everyone at 15 cents in the dollar - a radical change that would level the incentives given at the contributions stage - in a move that would save taxpayers around $6 billion a year, and make super fairer for low-income earners.

The revelation comes after he confirmed for the first time that his May budget will include significant tax reform initiatives, giving voters the chance to see what kind of tax plans he has, well in advance of any election campaign.

He also began talking up the problems with raising the GST in a sign his appetite for an increase could be waning.

In a radio interview on Friday, the Prime Minister spent a good deal of time listing the pitfalls and drawbacks of raising the GST to 15 per cent.

If the government was to raise the consumption tax to provide income tax relief it would also need to increase pensions, craft a complicated compensation program and make sure the country was getting a "a growth dividend that justifies the trouble and expense", he said.

Fairfax Media understands the Prime Minister has become very interested in a proposal to make tax incentives for contributing to super the same for everyone at 15 cents in the dollar.

The flat-rate concept Mr Turnbull has been considering was floated in the Henry Tax Review, but the specific proposal can be found in a recent paper from Deloitte Access Economics, called Shedding Light on the Debate: Mythbusting Tax Reform.

The Deloitte paper says taxpayer subsidies for super are very poorly targeted, benefiting high-income earners disproportionately.

It says low-income earners are paying far more tax when a dollar of their earnings shows up in superannuation rather than their wages, whereas middle and high-income earners are getting big marginal benefits.

That finding was also promoted by the Murray Review, which found only $1 in every $200 of the cost of super concessions goes to the bottom 20 per cent of income earners, whereas more than half goes to the top 20 per cent.

"We should consider making tax incentives for contributing to super the same for everyone at 15 cents in the dollar," the Deloitte paper says.

"That would put super on a simpler, fairer and more sustainable basis, and the resultant savings of taxpayers' money - at around $6 billion a year - would be large.

"It could, for example, pay for shifting the company tax rate down to 26 per cent from the current 30 per cent, thereby delivering a prosperity dividend to all Australians."

It is understood Mr Turnbull is seriously considering the proposal.

Labor and the superannuation industry on Friday reacted angrily to reports that the Turnbull government is preparing to scrap the legislated rise in compulsory super contributions from 9.5 per cent to 12 per cent of salaries.

The super guarantee is set to rise to 10 per cent in 2021 and then increase incrementally to 12 per cent by 2025. If the government stops it rising it will start to collect far more personal income tax than it will lose from less super income tax.

Shadow Treasurer Chris Bowen said Mr Turnbull would have a "very big fight on his hands" if he tried to prevent the super guarantee rising.

"Liberal Prime Ministers have form," Mr Bowen said.

"John Howard promised to keep the scheduled increases that Paul Keating left him. He broke that promise. He squelched on his promise. Tony Abbott promised to keep the schedule that Kevin Rudd left him. He broke that promise. Now Malcolm Turnbull looks like he has been contemplating going down the same road."

Industry Super Australia chief executive David Whiteley said it is hard to believe the Turnbull government would seriously consider capping increases to compulsory super, "one of the major pillars in our retirement income system and our economy." 
 
"These proposals would reduce individual savings of millions of super fund members, reduce national savings and increase pension outlays," Mr Whiteley said.

with Adam Gartrell

Follow us on Twitter