Business and welfare groups say they fear tax increases and service cuts while unions are worried about job security for public servants as the Andrews Labor government prepares to hand down its budget on Monday.

Plummeting revenue from stamp duty, the state government tax on property sales, has led to fears that Treasurer Tim Pallas might impose a horror budget on Monday, making cuts and raising taxes to replace the money he is losing through the cooling real estate market.

The property sector’s peak body has warned Mr Pallas that imposing new taxes or levies in next week’s budget to fill the gap left by dwindling stamp duty revenue would only lead to more long-term pain.

Treasurer Tim Pallas Credit:Alex Murray

The Property Council says the sector is braced to be hit with new taxes or levies on Monday after the government refused to be drawn on industry speculation that a massive increase to the congestion levy, charged to inner-city car park owners, is on the way.