Make no mistake, every state will get more GST if the Federal Government’s GST reform legislation passes unchanged – the additional funding in to the GST pool assures it and this has been confirmed by the independent Productivity Commission.
The Federal Labor Party must now take the high ground and do what’s right for the nation as a whole. Leader of the Opposition Bill Shorten must end the bickering between the states and support the Government in its national interest solution.
For West Australians, this is a test for Bill Shorten to do what is right for the national economy. He has declared he is on a unity ticket with the Federal Government so now is the time for him to say the same thing in the Federal Parliament as he has been saying in Perth by voting for the legislation as it is.
The Federal Labor Party has claimed that it wants to ensure that no state will be left worse off by the reforms, yet the only reform it has guaranteed to support so far – which does not include a change to the formula – is one that will leave every state millions of dollars out of pocket.
If the Federal Labor Party does not vote for the full reform package and only legislates a ‘GST floor’, CCI modelling has identified that WA will be $1.7 billion worse off, while NSW will lose $351 million, Victoria $425 million and Queensland $518 million, relative to the Federal Government’s proposal. Recipient states will also lose large amounts – South Australia $257 million, Tasmania $112 million and the Northern Territory $258 million.
Ruling out a change to the GST formula is ruling out a long-term fix to the GST and the national economy will suffer as a result. It sends a message to West Australians that the Federal Labor Party thinks they should continue to do all the heavy lifting while most of the benefits go to other states.
Ninety per cent of WA’s iron ore royalties are redistributed to other states through the GST. Blocking the Government’s legislation will keep it this way, guaranteeing sky high GST receipts for every other state ahead of fixing a GST system that delivered WA 30 cents in the dollar.
Even State Treasurers have today, for the first time, conceded that the GST system has not been working in the way it was intended and that WA has received an unfair deal. The WA State Government has also made it clear they support the legislation in its current form.
CCI has led the charge to advocate for GST reform on behalf of industry, recognising that to fix the unfair GST distribution the ‘poor WA’ argument was never going to convince a nation – we had to make the national case for change.
According to exclusive national polling of 2,350 Australians commissioned by CCI, 70 per cent of Australians believe that WA’s GST share fell to an unacceptable level – below 35 cents – and most Australians (52%) believe that if it is in the national interest to change the GST distribution it should be changed.
The poll also revealed that fixing the GST is the most important issue to West Australians, second only to cost of living and 68 per cent of West Australians believe the GST distribution should focus on the national interest instead of a political fight between the states and territories.
It is time for the GST to stop being a political football. Federal Labor must rise above the politicking and vote for the Government’s GST reform legislation because every state stands to benefit.