Ratings agency Standard & Poor’s has again issued stern warnings about Australia’s credit rating.

Just a few months after S&P’s put Australia's credit rating on a negative outlook - indicating a one-in-three chance of a downgrade in the next two years - it now says change could come sooner.

“As we said in July, we will continue to monitor, over the next six-to-12 months, the success or otherwise of the new Government's ability to pass revenue and expenditure measures through both houses of Parliament,” S&P's head of sovereign ratings Craig Michaels said.

“Whether we maintain our AAA rating or not partly rests on the Government's willingness and ability to enact new budget savings or revenue measures to reduce fiscal deficits materially over the next few years.”

Treasurer Scott Morrison says it is time to cut corporate taxes.

“There will be a drain of capital going to the lower tax jurisdictions and where does that leave revenue then?” he asked.

“So you have to remain competitive and continue to allow your companies to be able to have the earnings, and that means that they can pay their staff more, that they can give them more hours and that they can take home more. That's how you lift revenue.”

The Opposition says it is open to negotiating with the Government on its own tax plans.

“If the Government was serious about protecting the AAA rating, first they'd adopt our plans on negative gearing and capital gains tax,” shadow treasurer Chris Bowen argued.

“They would drop their $50 billion tax cut — I mean the Government's lecturing the Australian people about the need for restraint, while arguing at the same time for a $50 billion corporate tax cut, the biggest single hit on the budget that was provided in the last election campaign.

“And then, finally, the Labor Party's, of course, suggesting improvements to the Government's own superannuation package, which would add an extra $1.4 billion over the next four years and more than $18 billion over the next decade.

“Even if they didn't want to adopt our policy exactly, if they said; ‘Look, we've got a different way of dealing with capital gains tax’ or; ‘We've got a different way of dealing with negative gearing reform’ or; ‘We've got a different way of raising an extra $1.4 billion on super’, okay, let’s have that conversation.”

The Federal Government’s Mid-year Economic and Fiscal Outlook (MYEFO) will be released on December 19.