S&P Global Ratings has sounded the alarm on the minority Liberal government's budget, delivered on Thursday by Treasurer Eric Abetz.
Tasmania has slid into debt quicksand this decade with a series of huge deficits, and 2026-27 will be no different, with a $597 million deficit forecast.
However, Mr Abetz has conjured a surplus in 2027-28 - a year earlier than previously forecast - with $1.47 billion in cuts over the next four years.
S&P is dubious, issuing a statement that the "dramatic turnaround" job faces "high execution risk," noting previous failed efforts to rein in debt.
"Tasmania aims to cut nominal operating expenses between fiscals 2026 and 2029, compared with growth of about 6 per cent per year historically," it read.
"This will be challenging, in our view, given inflationary pressures, its aging population and rising demand from voters for health, education, and other social services."
Tasmania was handed its first downgrade in 32 years by S&P in the shadow of last year's budget, and has a credit rating of AA.
Credit ratings impact the budget predicament as they influence the interest rate the state can borrow at.
The latest books show debt peaking at $9.98 billion in 2028/29, with Tasmanians to pay $2.2 billion in interest servicing that debt over the next four years.
However, in a frightening prospect for bean-counters, S&P believe debt will more than double, "likely breaching $A20 billion" in 2028-29.
Should that happen, a fresh downgrade would be on the cards.
"Tasmania promised ambitious fiscal outcomes ... delivering on them will be key to maintaining our rating on the state," S&P said.
Mr Abetz has ordered $216 million of savings next year, two-thirds in the already-stretched health system.
The budget papers suggest savings will come through more user-pays treatments, shuffling employees around and hiring fewer short-term health workers.
Frontline health services are not prioritised for cuts, but they are on the table, alarming opposition parties.
"We thought the premier had handed Eric Abetz a knife to gut the public service, but today's budget shows he actually gave him a chainsaw," Labor finance spokesman Dean Winter said.
"There is no detail about what they are, but the $130 million in cuts to health just next year is the equivalent of sacking three nurses a day for the entire year."
The Greens also condemned the budget, calling on the government to abandon its new Hobart waterfront stadium and raise corporate taxes.
Both opposition parties have pledged to pass the budget and not repeat the high-stakes politics that sent Tasmania to a snap election last year.
A billion-dollar deficit last May prompted Labor to move a no-confidence vote in Premier Jeremy Rockliff, which passed, triggering an election.
The Liberals' increased vote gave them a mandate for fiscal repair, Mr Abetz told journalists.
"What we're doing is getting on with the job that the people want us to do: they do want responsible government and they do want balanced budgets," he said.
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