Electoral annihilation unless GST fixed

Action on the GST in WA could be the difference between winning and losing the next election for the Turnbull Government, according to a recent poll commissioned by CCIWA.

A recent state-wide Patterson poll of more than 800 Western Australians shows the Australian Labor Party could gain a 27 per cent increase in the number votes if the party endorses a policy to reform GST which delivers a greater share to WA.

It would see Liberals in marginal seats like Steve Irons and Ministers Christian Porter, Ken Wyatt and Michael Keenan booted from their electorates.

CCI Chief Economist Rick Newnham says the independent polling strongly indicates GST reform is at the forefront of voters’ minds and inaction at a federal level could result in a loss of Liberal seats held in WA at the next election.

“Western Australia not only deserves a greater share of GST, an increase of revenue from the Federal Government would help to improve the State’s economy,” he says.

“If GST was distributed equally per capita, WA would gain more than $11 billion over the next three years, which is the equivalent of seven new Perth Stadiums.”

More than 80 per cent of those polled said that GST reform ranked highly as an issue leading in to the next federal election.

About 51 per cent of respondents indicated it was one of the most important issues.

“GST is now the major issue for swing voters in WA,” Newnham says.

“Nine per cent of those polled said they would switch their vote from another party to the Liberals if PM Malcolm Turnbull committed to reforming the GST distribution, while 12 per cent of voters said they would switch to voting for Labor, from another party, if Opposition Leader Bill Shorten committed to GST reform.”

Newnham says CCI and the business community are calling for the immediate introduction of a GST floor below, which no state’s GST share can fall.

This can be done today by the Treasurer simply directing the Commonwealth Grants Commission, he says.

“We are also calling for partial equalisation should the Productivity Commission (review of the GST system) conclude that the current GST model hinders national economic growth,” he says.

“A partial equalisation system of GST distribution would not only increase much-needed revenue for WA but also incentivise other states to grow under-developed industries which has the potential to pump billions into the national economy.

“The vast majority of WA voters are not asking for special treatment, they are simply demanding a system that incentivises economic growth in the country, instead of stifling it.”

In its submission to the Productivity Commission, CCI has demonstrated the current GST distribution mechanism hinders national economic growth, which is supported by the Business Council Australia and several other industry associations representing more than 18,000 businesses and 400,000 employees.

► To read CCI’s GST submission to the Productivity Commission in full, please click here.

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