‘Should not be punished': Queensland decries GST carve up
Cash-strapped state governments are looking west with envy as Western Australia pulls in its large slice of the GST carve up despite the healthiest books in the country.
Resource-rich WA posted a $2.5bn operating surplus on Thursday – it's seventh budget surplus in a row.
From Friday it is set to receive its share of the GST pool of 75 cents in the dollar, despite its strong revenue stream from its resources sector.
State premiers and treasurers have been agitating for changes to the GST distribution, since the final figures were announced in March, and ahead of the funds formally being dished out on Friday.
WA is still enjoying the windfalls of a 2018 GST deal struck under previous Coalition government by then-treasurer Scott Morrison and backed in by the Albanese government, where WA is guaranteed 75 cents of every dollar paid in GST. Without this benchmark, WA would have received as little as 18 cents back.
The WA Premier and Treasurer credited their economic management for this week's operating surplus and healthy debt forecasts. Iron ore prices are hovering at $US95 while the state government has done its forecasting with an expectation of $US72 a tonne.
But every state and territory except WA has been posting deficits since the 75 cent distribution reforms in 2018.
The Queensland Treasurer feels short-changed, as strong coal royalties pad the state coffers.
Victoria and NSW's slices of the GST pie are set to expand while Queensland's portion gets a trim.
'This money belongs to Queenslanders and we should not be punished because of our support for industries that underpin our national wealth,' state Treasurer David Janetzki said.
The impending Queensland state budget, to be delivered on Tuesday, will show the effects of a dip in coal prices after an $8.8bn royalties windfall during the past four years.
Despite the Sunshine State's royalty take coming down, Queensland's GST payout this year falls by $1.1bn to $16.5bn.
In a speech to the National Press Club on Wednesday, federal Treasurer Jim Chalmers, who has historically opposed raising the GST rate, left the door slightly open to raising it from 10 per cent – the amount the excise has remained for the past 25 years.
'I've, for a decade or more, had a view about the GST,' he told The Conversation.
'I repeated that view at the Press Club because I thought that was the honest thing to do, but what I'm going to genuinely try and do, whether it's in this policy area or in other policy areas, is to not limit what people might bring to the table.'
This year, Queensland is the only state or territory getting less than previous years, while every other jurisdiction is getting more.
Victoria is set to become a net-recipient of the GST pool for the first time as well.
'It used to be the case that our friends in Victoria would help us shoulder the burden in supporting all the other states,' NSW Treasurer Daniel Mookhey said last month.
'Victoria is now a recipient state, to quite a large degree, $1.07 (per dollar taxed) is what they're getting.
'I'm going to continue to speak out, particularly about the fact that NSW is now carrying the federation when it comes to GST distribution.'
The Northern Territory receives $5.15 for every dollar it contributes, far and away the largest return. Despite having the second largest population, Victoria receives the largest portion of the total pool, getting 27.5 per cent; with a $3.6bn year-on-year increase this time around.
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