The Federal Government must keep its promise and reject the findings of a Productivity Commission report recommending Western Australia lose its current GST safety net.
The interim report recommends three different scenarios for reforming the GST system. All three would result in a significant cut in the GST revenue that flows back to WA.
CCIWA Chief Executive, Will Golsby, said the recommendations would drag WA and the nation backwards.
“It’s hard to believe that the Productivity Commission would recommend going back to a system that it itself said was broken back in 2018, before the reforms that gave WA its safety net,” he said.
“Returning to a pre-2018 GST system would blow a hole in WA’s finances, meaning less money for schools, hospitals, roads and the major infrastructure our state needs to keep the national economy strong.
“It also protects WA from the boom-and-bust cycles of our resources sector.”
Mr Golsby said the Albanese Government has promised WA’s GST deal would not change, regardless of the Productivity Commission’s recommendations.
“This report is disappointing – but it’s not the final word. The Productivity Commission has made a recommendation and now the Commonwealth needs to make the right choice.
“Our message to Canberra is simple: Keep your promise and keep the deal,” he said.
Mr Golsby said scrapping the GST deal would threaten Australia’s competitiveness and our ability to diversify the economy.
“If Australia wants more investment, more jobs and more exports, we can’t have a tax distribution system that penalises the state for creating them,” he said.
“Western Australia is the engine room of the national economy and changing the GST deal will undermine investment and business growth in this state, the benefits of which are distributed across the nation.”
Mr Golsby said the current GST deal was introduced for a reason.
“We can’t go back to a system where WA gets less and less of its own GST revenue while industry here delivers for the nation.
“The solution to another state’s budget pressures can’t be to punish WA by returning to a broken system.”
CCIWA’s petition to keep the GST deal has received the support of more than 7,200 Western Australians.
