Reverse the GST Inequity for WA, Gardiner
Author: Philip Gardiner
Published on: 17-August-2011
Nationals WA upper house member for the Agricultural Region, Hon Philip Gardiner has warmly welcomed the move by Federal Member for O’Connor Tony Crook to reverse WA’s GST disproportionate contribution to other states of Australia, as determined by the Commonwealth Grants Commission (“CGC”) under a policy known as horizontal fiscal equalisation.
Mr Crook has tabled a motion in Parliament this week calling on the Federal Government to constrain the CGC to a 75 per cent floor on GST relativities.
Mr Gardiner said WA is forecast to lose billions of dollars unless a floor on GST relativities common to all states is introduced.
“A 75 per cent floor would deliver an estimated $1.8 billion to WA in 2013-2014 and an estimated $2.5 billion in 2014-15 to match infrastructure spending with WA’s economic growth,” Mr Gardiner said.
“The lost GST revenue projected for 2014-15 alone is worth more than double the entire Royalties for Regions program in the same year.”
Mr Gardiner said WA was currently receiving less GST relative to its population than any other state since the GST was introduced.
In 2010-11, WA received only 68 per cent of per capita revenue, while no other state received less than 91 per cent.
Current estimates indicate WA in years to come will receive just 33 per cent of per capita GST revenue.
“This is unfair and inequitable and I commend the Member for O’Connor for standing up to secure a fair and reasonable deal for Western Australia,” Mr Gardiner said.
Even though WA was a claimant state for a significant part of the 20th century, this was prior to introduction of the GST which was designed to bring greater equality of payments across states.
Mr Gardiner said the GST floor would not prevent WA from continuing to contribute to the Commonwealth and allowing GST revenue to be fairly distributed between other states. It should be noted that the Commonwealth also provides Special Purpose Payments (“SPP”) to states, and SPP comprised 24% of the State’s revenue in 2010/11. For the same year, GST from the Commonwealth comprised 14%.
The GST motion was endorsed by The Nationals WA State Council last weekend and officially tabled in Canberra during this week’s sitting of Federal Parliament.
“All of Western Australia’s Federal representatives in Canberra should support this motion designed to deliver a fairer and more reasonable deal for the people of Western Australia,” Mr Gardiner said.
Further information on the Commonwealth GST rip-off of Western Australia can be found online at www.tonycrook.com.au.
