State budget 2025-26: Victorian Treasurer Jaclyn Symes pledges no surprise taxes

A $31bn health package will be the centrepiece of Tuesday’s state budget, including a $9.3bn boost for hospitals.

A $31bn health package will be the centrepiece of Tuesday’s state budget, including a $9.3bn boost for hospitals.

The government said the hospital spend, up $500m on last year, would give certainty to public hospitals and security for frontline staff. Victorians won’t be hit with any new taxes in Tuesday’s state budget, Victorian Treasurer Jaclyn Symes has pledged.

Symes, who on May 20 will hand down her first budget, has also hinted that more cost-of-living support could be on the way for cash-strapped Victorians.

“There’s more surprises still to come,” she said on Monday.

The comments came after it was revealed the 2025-26 budget is expected to post a surplus, but one that is $1bn less than what the government was forecasting in December.

Speaking on the eve of the budget, Ms Symes firmly ruled out any new or increased taxes — apart from the already announced hike to the emergency services levy — after spending the past five months consulting with experts and everyday Victorians.

“The message I heard loud and clear from the business sector, industry sector was no more taxes,” she said.

“There is nothing in the budget that changes the tax settings tomorrow.

“I am pleased you will not see new taxes in tomorrow’s budget.”

Treasurer Jaclyn Symes’ first budget will deliver an ­operating surplus of $600m. Picture: David Caird

Last year’s budget forecast net debt to reach an eye-watering $188bn over its forward estimates.

On Monday Ms Symes was tight-lipped on what the updated debt figures are, but said it would not break the $200bn mark.

“The aggregates will be revealed tomorrow — they will not start with a two,” she said.

As reported in the Herald Sun on Monday, Victoria’s first surplus since ­before the pandemic will be $900m less than what the Allan government forecast just a year ago as Ms Symes fights to claw back the state’s monstrous debt.

Ms Symes will unveil an operating surplus of $600m for 2025-26.

In his final budget last year, Tim Pallas said Victoria was on track to return to an operating surplus of $1.5bn by 2025-26.

And as recently as December, the government predicted it would increase to $1.6bn.

Ms Symes said the $900m shortfall was a deliberate decision that she had taken to provide cost-of-living relief to cash strapped Victorians.

“We could have elected to have a larger surplus in tomorrow’s budget but what we did is choose to back Victorians,” she said.

“We know that cost-of-living and frontline services … are the priorities that Victorians expect a Labor government to get behind so we are investing in health, mental health, education, transport — all the things that Victorians want.

“We’re also offering practical cost-of-living measures as well as delivering a surplus.

“We have been responsible, we’ve made tough decisions but we’ve made the right decisions.”

Victorian Premier Jacinta Allan has said she will hand down a responsible budget. Picture: Valeriu Campan

Tuesday’s state budget will also confirm that net debt as a share of the economy will peak in 2026-27 before it is expected to fall over the following years.

Official forecasts show Victoria’s debt is on track to hit an eye-watering $188bn by 2028, but blowouts on major projects and the government’s wages bill are expected to significantly impact that figure.

The government has been frantically working to avoid a debt blowout that sources warned could see net debt ­exceed $200bn for the first time in the state’s history.

Shadow Treasurer James Newbury said every Victorian should be scared by that prospect. “Families and businesses are being squeezed harder every year, while Labor continues to blow the budget with no accountability,” he said.

While this year’s surplus is lower than what had initially been forecast, Ms Symes said the predicted operating surpluses of $1.9bn in 2026-27 and $2.4bn in 2027-28 were an ­improvement from the 2024-25 budget update.

Shadow Treasurer James Newbury says families and businesses are being squeezed harder every year. Picture: David Caird

In that update, the government had anticipated a return to an operating surplus in 2025-26 of $1.6bn, increasing to $1.7bn in 2026-27 and then $2bn by 2027-28.

Returning to an operating surplus is the third step of the government’s five-step fiscal strategy, which was established in response to the massive ­levels of spending undertaken during the Covid pandemic.

The next step of the plan is to stabilise net debt levels as a proportion of gross state product.

“From here, net debt will continue to fall as a share of the economy, and we will see continued surpluses in the years to come – allowing us to continue to provide services and infrastructure that Victorians need,” Ms Symes said.

Premier Jacinta Allan – who on Sunday unveiled that public transport would become free for every child across the state – said Victorians had demanded a “responsible budget”.

The $318m policy which is the government’s key cost-of-living sweetener is expected to save families up to $755 a year per child.

“Victorians want a responsible budget that sets up our state for the future, and they want real help to ease the cost of living right now,” Ms Allan said.

The Herald Sun can also reveal the budget will include a $9.3m boost to provide free training to TAFE teachers.

WHAT WE KNOW SO FAR

$600m operating surplus

$727m to operationalise the Metro Tunnel

$98.7m to boost train frequency across metro and regional lines

$4bn for Sunshine station works

$61m in stamp duty tax cuts

$722m to expand prison capacity

$976m injection for regional roads

$318m for free public transport for youths

Originally published as State budget 2025-26: Victorian Treasurer Jaclyn Symes pledges no surprise taxes