Mining royalties and GST worth $18billion have pushed WA's budget into a surplus for the eighth year in a row, bringing a windfall cashback to residents in the state.
The extra income for the state means Treasurer Rita Saffioti will reinstate fuel and student handouts on top of making improvements to the health system.
WA's surplus is expected to continue into the next financial year, with $9.3billion set to be collected in GST alone.
This year's $18billion surplus came from $8billion in GST and $10.8billion in mining royalties.
Saffioti said the funds will allow the state government to give WA drivers $100 in fuel credit and parents with children in school up to $250 per child, The Australian Financial Review reported.
A family with two high school-aged children are set to receive up to $700, to be transferred directly into their bank accounts.
The payments will not be means tested and do not have to be spent on fuel or student items.
The two programs are estimated to come at a cost of cost almost $290million.
Treasurer Rita Saffioti (pictured with WA Premier Roger Cook) announced thousands of WA residents will receive payments in the next budget
WA drivers are set to receive $100 fuel credits and parents of school children could see payments of $250 per child
'This is extra support, far more than was anticipated for WA households. In this time of economic uncertainty, I am proud that we are providing a record level of cost-of-living support,' Saffioti said.
However, the Reserve Bank of Australia (RBA) warned the extra benefits could worsen inflation by increasing spending.
Independent economist Chris Richardson agreed, saying: 'If inflation is too much money chasing too little stuff, then extra money is not helping.
'It doesn't matter whether there's been a disruption to supply or demand – what matters is the gap between the two and extra spending makes that gap worse.'
Reserve Bank governor Michele Bullock earlier this week urged the government to bring inflation under control.
When asked by Bullock likely thought of WA's upcoming payments, Saffioti said: 'I'm not sure, but I didn't like their interest rate increases.'
Saffioti added WA had been heavily affected by the fuel crisis and wouldn't pander to other states.
'Instead of criticism from the other states, a simple thank you would be nice,' she said.