The state is on track to post a $375.9 million deficit for this financial year.
New Treasury estimates wipe almost $450 million off the bottom line across the forward estimates.
In May, the state government had planned to deliver a $10 million surplus in 2016-17.
That's now been revised to a $130 million deficit.
The state government is blaming 90 per cent of the write-down on factors beyond their control, including the federal government's decision to scrap the carbon tax and lower than GST receipts.
Premier Lara Giddings says the worsening finances would limit Labor to "modest" election promises.
The Liberals have promised to find $500 million worth of savings over four years to pay for their election promises.