Treasurer Rita Saffioti has delivered one of her bluntest GST dismissals yet amid grumblings over the latest carve-up that penalised Queensland and NSW for their surging coal royalties.
WA received an $830 million boost to its slice of GST next year — taking the total to $7.25 billion — while Queensland and NSW are forecast to record cuts of $469m and $310m respectively.
But talking to The West Australian, Ms Saffioti had little sympathy for the two States.
“We’ve been facing it year in, year out, to a much bigger degree before the floor came in,” she said.
“No one sympathised with us. They said, ‘Oh, you’ve got royalties, good luck.’ Now they have the same situation.”
Responding to the outcome — which also resulted in Victoria’s estimated GST revenue soaring by $3.7 billion — Ms Saffioti said other States were now experiencing what had been commonplace in WA prior to the 2018 fix.
“Welcome to our world,” she said. “We’re seeing New South Wales and Queensland receive cuts in their GST contribution because they’ve had coal royalties.
“That’s what was happening to us, year in year out. And now they’re saying the GST system is flawed? As I said — welcome to our world.”
Earlier, NSW Treasurer Daniel Mookhey was scathing of the latest carve-up, which he said illustrated the existing GST methodology was “out of touch”.
“NSW takes most of the nation’s population growth but is being punished by having its GST cut,” he said.
“It is an absurd process in dire need of reform.
“I agree with former treasurer Perrottet, when he railed in 2018 against the ‘black magic GST distribution formula’ which was ‘seeing the hardworking taxpayers of NSW being ripped off by a perverse and unfair distribution model’.”
Ms Saffioti said she could empathise with her east coast counterparts and agreed there were issues with the GST formula because it created “massive volatility” and made it difficult to budget.
But she was short on sympathy.
“We’ve been facing it year in, year out to a much bigger degree before the floor came in,” she said.
“No one sympathised with us.”
The GST is distributed on the basis of “horizontal fiscal equalisation”, with States effectively handicapped for their ability to raise revenue from alternative sources — such as mining royalties or stamp duty.
However — as highlighted by Ms Saffioti on Monday — pokies taxes and toll road revenue, neither of which is collected in WA, are exempt from the formula.
Under the system in place prior to 2018, WA’s GST share would have fallen to 11¢ in the dollar next year, slashing the State’s share by $6.2 billion to just $1.05 billion.
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2024-03-13 03:12:00Z
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