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flag Tasmania faces a $1.08 billion deficit by 2028/29, prompting job cuts, wage caps, and potential tax hikes.

flag Tasmania’s interim 2025/26 budget projects a $1.08 billion deficit and net debt nearing $10.4 billion by 2028/29, driven by structural issues, two early elections, pandemic costs, abuse survivor payments, and federal underfunding of health. flag Treasurer Eric Abetz announced public sector job cuts increasing to about 2,800, a new efficiency unit, and annual savings of $150 million starting in 2026/27, including $11.9 million in reduced procurement and leasing. flag Public sector wages, covering nearly half the $10 billion annual budget, are capped at 2.5%, with a rejected 21% pay rise deemed unaffordable. flag A narrow $5.6 million surplus is forecast by 2028/29, with debt repayment expected later. flag Treasury warns more revenue may be needed, leaving open the possibility of tax increases in 2026/27.

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