Tasmanian premier Lara Giddings says Labor's election promises will be offset by $165 million in budget savings.
Ms Giddings says the cuts will be made over three years to areas such as travel and consultancy payments.
The premier has been under pressure to outline savings after last month revealing a $450 million budget blowout over the forward estimates.
The opposition Liberals have pledged $500 million in cuts, including the axing of 500 public service jobs.
"The Liberal Party has already racked up $378 million in spending promises and has been unable to explain how it will achieve its unrealistic savings," Ms Giddings said in a statement.
Labor, which has pledged about $100 million in election policies, says no jobs will be lost under its savings plan.
Ms Giddings' announcement comes a day after credit rating agency Moody's warned Tasmania's AA1 rating was in danger if budget deficits continued to get bigger.
