About 1500 jobs will be slashed from the public service to pay for $450 million in savings, unions say.
Angry Community and Public Sector Union secretary Tom Lynch said public servants also would have to take pay cuts over the next four years.
Mr Lynch said ministers could not give any details of which backline jobs would be lost.
"Any jobs that could have been cut have already been cut," he said.
"I've no idea how Peter Gutwein thinks that agencies that already are under stress are going to run with 1500 fewer people.
"It makes less sense than any budget I've ever seen.
"Public servants were worried that if they asked for more than two per cent there would be job cuts. Well now they're getting job cuts and a pay cut too."
It makes less sense than any budget I've ever seen.Tom Lynch
Mr Lynch said a review of the state service was code for privatising some parts of the public sector and he feared no workers would be attracted to Tasmania with low wages.
Unions Tasmania secretary Jessica Munday also condemned the budget,
"It's a disaster. It is an attack on public servants and essential services," Ms Munday said.
"It is a naked political attack on jobs and the backline workers who support our teachers and nurses."
Ms Munday said there was no funding for training for infrastructure jobs and she also was worried that Worksafe Tasmania was under funded.
"A lot of this money is just re-packaged funding," she said.
MORE ON THE STATE BUDGET
Police Association of Tasmania president Colin Riley welcomed $6 million over the next four years to update residential accommodation for police officers and families in remote locations.
"There's good and bad in the budget. It's great to see money for country police housing but there is no funding for IT services," Mr Riley said.
*We also welcome strong support for the progress towards establishing a full time core SOG - a $1 million allocation to secure a fit for purpose facility in and $100,000 per annum for the purchase of new equipment supporting high risk police operations.
"We are disappointed that there is no funding beyond December 2019 for Project Unify which is updating the police IT systems.
"This will create issues as many of the police systems are antiquated and will fall over in the coming years.
"Unfortunately, the efficiencies and corporate knowledge established by the project team, will be lost as the project finishes later this year and is disbanded."
Labor leader Rebecca White described the budget as "staggering".
"Tasmanians will be shaking their heads and asking 'what has gone wrong'?" Ms White said.
Labor treasury spokesman Scott Bacon said the budget would plunge Tasmanian into more than $1 billion in net debt.
"We've got a government that has squandered the good economic times and is going to put us back into net debt for the first time for 15 years," Mr Bacon said.
We've got a government that has squandered the good economic times and is going to put us back into net debt for the first time for 15 yearsScott Bacon
"It was 15 years ago that Labor repaid the last Liberal Government's debt. Now Peter Gutwein is taking us back there in what he calls a 'golden age'."
Mr Bacon said the budget was an attack on essential services including health and education, with $450 million in new cuts and "raiding TT Line to prop up their fiscal incompetence".
"Peter Gutwein has broken a massive promise to Tasmanians by taking the state into net debt of more than $1 billion," he said.
Property Council Tasmanian executive director, Brian Wightman, said: "This budget is easing congestion, and supporting the immediate supply and affordability of Tasmanian homes."
IN OTHER NEWS
"The Hodgman Government's decision to allocate $40.5 million from the existing four-year action plan is a timely response to housing stress," he said.
However, he was critical of the increase in the Foreign Investor Duty Surcharge.
"Ballooning the Foreign Investor Duty Surcharge from 3 per cent out to 7 per cent overnight sends the wrong message," Mr Wightman said. "We strongly encourage the Government to consider the economic ramifications of this policy."
Local Government Association of Tasmania president Doug Chipman welcomed planning funding in the budget but was disappointed there was no new funding to support waste management and resource recovery.
"Tasmania lags well behind most other jurisdictions when it comes to how we manage our waste and as a State we are missing out on significant opportunities associated with resource recovery, Alderman Chipman said.
"For example, proportionally Tasmanian is not diverting as much material away from landfill compared to other States."
Tourism Industry Council chief Luke Martin welcomed the government honouring its tourism commitments.
"The regional attraction loans scheme is a positive initiative to stimulate new experiences in regional areas," Mr Martin said.
"We also welcome the additional funding for the West Coast Wilderness Railway, which secures the future of this iconic regional attraction."