Victoria's finances will defy a dramatic $5.2 billion collapse in stamp duty revenue with a projected $1 billion surplus in the coming financial year, Monday’s state budget will show.

Treasurer Tim Pallas, who is delivering his fifth budget, will forecast surpluses as far as the eye can see, with the budget remaining in the black by an average of $3.4 billion over the four-year forward estimates period.

Victorian Premier Daniel Andrews and Treasurer Tim Pallas, who will deliver his fifth budget on Monday. Credit:AAP

But Mr Pallas and Premier Daniel Andrews were under fire on Sunday from the Liberal Opposition over the $700 million in tax increases they plan to impose to offset the plunging stamp duty revenue. The shortfall is set to be about $1.3 billion a year after the fall in the housing market.

The Labor government argues the tax hikes “strike the right balance” but Liberal leader Michael O’Brien says they show the budget will be "full of new taxes and broken promises".