A restructuring of Denmark's tax authority is financed by the budget, and 2.5 billion kroner is designated to be spent on the country's military, police and prison service.
State-owned rail operator DSB will lose 207 million kroner of funding, with cuts increasing to 829 million kroner by 2021.
The budget must now be passed by parliament, with negotiations set to take place in the coming weeks.
Political spokesperson Nicolai Wammen of the opposition Social Democrats told news agency Ritzau that the budget had too little focus on welfare.
“We want to ensure first and foremost that our welfare will not suffer. There must be time to take care of our elderly and god schools for our children and enough staf to take care of our sick,” Wammen told Ritzau in a written response.
“If we are to ensure safety for all, we need more police. We think that is an important priority for next year's budget,” he said.
Finance Minister Kristian Jensen said in the government release of the budget that welfare and tax reductions were not mutually exclusive.
Denmark's BNP is set to by two percent for the first time since 2006, according to Ritzau.