The Liberal Government has ended a decade-long campaign, unanimously passing the GST reform package through the Senate.
The new package ensures every state and territory will be better off, with an additional $9 billion in extra untied funding delivered over 10 years and an additional $1 billion in perpetuity once fully implemented.
Federal Member for Moore, Ian Goodenough MP said, “The current GST system has been a contentious issue in Western Australia for a long time, and I’m pleased that the Liberal Government has been able to deliver a real long-term solution rather than a quick political fix.”
The reform package will leave Western Australia $4.7 billion better off over the next decade.
The changes include a 70 cent floor established in 2022-23, ensuring no state or territory falls below the new threshold. In 2024-25 the floor will increase to 75 cents. Western Australia will receive $814 million in 2019-20, $585 million in 2020-21 and $305 million in 2021-22 prior to the introduction to the floor.
“Many of my constituents had named the inequity in the GST distribution formula as their top concern, so I am proud to be a part of the Western Australian Federal Liberal team that has continuously campaigned for this change and achieved the desired outcome.”
“Delivering this result has been a long but collaborative process between all levels of Government across Australia, and it is a credit to Scott Morrison as the former Treasurer and now Prime Minister.”
The transition to reinforce and protect the ‘fair go’ system of Horizontal Fiscal Equalisation will alter the benchmark focus from Western Australia to Victoria and new South Wales as the country’s most stable economies.
Western Australia’s share of GST fell to a record low of 30 cents per dollar in 2015. The Commonwealth Grants Commission deemed Western Australia the state with the “strongest fiscal capacity”, long after the mining boom ended. The current GST share for Western Australia sits at 47 cents to the dollar.
“The top-up funding provided by the government can be used to deliver any essential service or infrastructure project that will benefit the state. It guarantees that we can provide WA schools, hospitals and infrastructure with additional funding to improve service delivery.” Mr Goodenough said.