It's only a few months into the financial year but the signs are Treasurer Scott Morrison will be able to boast a further improvement in the budget position at the end of the year.
Company tax revenues are on the rise and the strong increase in the number of people employed in recent months suggests income taxes will also be higher than previously forecast.
Mr Morrison has also promised to keep a tight rein on spending.
He released the final budget outcome of for the 2016/17 financial year on Tuesday, posting a $33.2 billion deficit and a $4.4 billion improvement on what was forecast at the time of the May budget.
It was the smallest deficit in four years and allowed the treasurer to re-commit to a pledged budget surplus in mid-2021.
However, Labor is quick to point out Mr Morrison's predecessor Joe Hockey had predicted a deficit of just $10.6 billion for 2016/17 in his first budget.
Westpac senior economist Andrew Hanlan also wasn't getting too carried away with the result, saying the budget has been stuck in deficit for nine years for a cumulative shortfall of $350 billion.
"That compares to a cumulative surplus of $103 billion over the 11 years to 2007/08," he said.
Mr Morrison will release the mid-year budget for 2017/18 before Christmas but after the September quarter national accounts which are due on December 6.
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