Tax cuts that take effect this week will see top income earners receive around $40 more per week in their pay packets.

The labor party promised the tax cuts in the lead up to the last election, after a similar plan to cut taxes was announced by the coalition.

Many commentators have questioned why the government is pressing ahead with the tax cuts, despite growing budget deficits, and the impact of the global financial crisis on the federal budget.

2SER's Tim Roxburgh reports.