West Australians should expect "no surprises" from this week's state budget but the government has not ruled out further tax hikes to help restrain its bulging bottom line.
Better than expected revenue from iron ore and dividends from WA utilities, combined with a boost in federal government funding, means a budget deficit of about $900 million.
Treasury forecast a $2.6 billion deficit for 2017/18 last December but that is expected to fall well below $2 billion after better than expected revenue, including a strong performance from iron ore and increased dividends from utilities.
Last month's $3.2 billion federal government road and rail windfall also helped.
But Premier Mark McGowan has refused to rule out further tax increases and Treasurer Ben Wyatt has repeated warnings that despite the improvement, the purse strings will remain tight through to 2018/19.
Hikes in household fees and charges have already been announced and people should expect to be slugged an extra six per cent for water and about seven per cent for electricity.
Asset sales including the TAB and Landgate are unlikely to be included in the forthcoming budget, with the government shortly to receive a final report from a scoping study into the sale of the land registry.
And despite the boost in federal funding, the government still has to find $2.2 billion for its key Metronet rail project which will not be fully funded in this year's budget.
Mr McGowan has said the government will be going through its business cases and hopes for further Commonwealth generosity to come.