National's first three fiscal priorities for the next three years were to return to surplus this year and maintain surpluses thereafter, reduce net government debt to 20 per cent of GDP by 2020, and to reduce ACC levies further from April 2016.
Income taxes would begin to fall from April 2017 "providing economic and fiscal conditions allow, and if the first three priorities have been achieved". Mr English again emphasised those cuts would be modest and targeted at low to middle-income earners.
Details of tax cuts would be considered closer to that date, he said.
Any further fiscal headroom would be used to pay down debt faster, Prime Minister John Key said.
Of the $1.5 billion set aside by 2017, Mr Key said about $1 billion would go to debt reduction while $500 million would go to the tax cuts.
Mr English said the increased government spending was consistent with previous increases by his Government and was in stark contrast with the $18 billion Labour and the Greens were planning to spend over the next four years.
A National Government would begin paying down net debt by 2017-18.
That would put New Zealand in a much better position to withstand any future economic shocks or natural disasters, he said.
"We believe that this approach will help keep interest rates lower for longer for New Zealand families."
Asked to give detail on what any tax cut package might look like, Mr Key said: "It's not our intention to do that today, we'll cross that bridge when we come to it."
Mr Key said whatever the level of tax cuts a National Government settled on, whether it amounted to $500 or $1000 a year for low to middle-income earners, "most would say that would make a difference".
Mr English said the Government was not considering any changes to the tax treatment of savings.
Asked about the timing of the cuts - immediately before the next election, Mr Key said, given the short electoral cycle, "the long and short of it is that's just the way things go".
Mr Key said his Government was making "a stark and clear choice" to spend less so it could pay off debts and cut taxes while Labour was proposing to spend an additional $18 billion over four years and add five new taxes. Mr English rejected suggestions National was only talking about tax cuts now to counter negative perceptions around Nicky Hager's Dirty Politics.
Labour leader David Cunliffe said the proposed cuts were a "joke".
"I thought John Key was going to deliver a block of cheese. Turns out that it's only half of that.
"It's in three years' time, maybe, if you're lucky, and if ... the economy doesn't fall in a hole. This is a joke."