WA Fights for GST Deal Review

0:00From the Daily News Now Network, this is Adelaide News Today. Western Australia is pushing hard to protect its 2018 goods and services tax deal with the federal government. That agreement guarantees the state a bigger slice of the National GST pool. Now the Productivity Commission is reviewing the whole system and will give recommendations next year. Western Australia has set up a special team and spent $1 million on ads to make its case. The deal means the Commonwealth tops up other states so they are not worse off, leading to a $44 billion cost over 10 years. Western Australia argues for shifting from full horizontal fiscal equalization to a partial version. This would let resource rich states like theirs keep more benefits from investments and policy choices. They point out other countries use partial systems. Economist Saul Eslake pushes back saying, Australia's full equalization helps keep living standards even across states. Western Australia's 124-page submission claims the state has contributed a net $32 billion to the federation since 1942.

1:07They highlight issues like eastern states getting more from Western Australia's iron ore and lithium royalties than the state itself. This treasurer Rita Safiotti insists the current deal should stay at minimum. If changes come, Western Australia wants a 25% cut and how mining revenue counts toward GST shares. That could slash the top of cost in half next year and end them by decades end. She notes the state drives 50% of national exports. Victorian Premier Jacinta Allen is not buying it. She says Victoria collects less revenue per person despite growth and big infrastructure needs. Allen vows to fight for her state's fair share in the ongoing debate. The Daily News Now is grateful to our sponsor for today's episode. Your pillow just got smarter. It plays your podcast and music. I S O L I and seeleypillow.com.