GST: WA’s share of GST payments to lift above 75 cent floor for first time in eight years

Western Australia will receive $9.3 billion in GST payments in the coming year and lift above 75 cents for the first time since the floor was put in place, as the body that splits the money warns falling iron ore royalties are starting to impact the State. Treasurer Jim Chalmers has promised the Federal Government remains committed to WA always getting its fair share – defying calls from the Crisafulli government for their “fellow Queenslander” to step in and change the carve-up. “We are big and enthusiastic backers of Western Australia and you see that in the billions of dollars in extra funding we’ve provided for hospitals, schools and cost-of-living relief in the West,” Dr Chalmers told The West Australian. “The West will always get its fair share of federal funding under Labor, and we’ll make sure of it.” Premier Roger Cook pre-emptively hit back at any suggestion this year’s result would add weight to calls to re-think the formula. “It’s important that we that other states acknowledge the role that we play in underpinning their standard of living,” he said. “Just about every other state, with the exception of New South Wales, gets extra GST from us, from Western Australia.” In comments sure to spark another round of east coast whinging, the Commonwealth Grants Commission said WA’s ability to raise revenue was falling, increasing its share of the GST and reducing the amount owed to other states including Victoria and NSW. It has recommended to the Commonwealth that WA receive back 82 cents for every dollar of GST raised in the State during 2026-27. “Key drivers of changes in state GST shares in 2026–27 include the value of mining production declining, large COVID-19-related health and business support expenses no longer being assessed, and the strength of property markets changing across Australia,” commission chair Mike Callaghan said. “Given the volatility in state economic and social circumstances, a change in a state’s GST share in 2026–27 cannot be assumed to continue in future years.” Treasurer Rita Saffioti said 82 per cent of WA’s population share is still less than others get back. “The claims other states are worse off under the current deal are simply incorrect,” she said. “Meanwhile, the Commonwealth has been significantly better off due to higher than expected company tax collections generated from WA which have far outweighed the cost of the reforms.” The CGC report released on Friday noted that WA continued to be the fiscally strongest State and said its GST relativity had increased to the same level as NSW as required under the 2018 legislation. Starting from this year, the 75-cent floor remains in place for all States, and there is now an additional guarantee that no State will receive less entitlement than NSW or Victoria, whichever is lower. Without the GST guarantee, WA would have received just 24 cents on the dollar, up from 18 cents in 2025-26. WA will receive $6.6 billion more than it would have before the guarantee, accounting for nearly two-thirds of its fair allocation. NSW’s share dropped compared to last year, as did Victoria. Both still received more in dollar terms, because overall there was an extra almost $6 billion to dole out. But NSW was quick off the blocks to complain that its share of the consumption tax had dropped to the lowest since the GST’s introduction in 2000. “This decision again demonstrates the need for a fairer allocation of how the GST is distributed across the states and territories,” acting treasurer Courtney Houssos said. Her State receives $1.8 billion less than Victoria despite its population being larger. Queensland Treasurer David Janetzki also went on the warpath, saying the proposed carve-up was a slap in the face because his State’s share grew slower than others. “Queensland has been dudded again by Canberra and the Federal Government,” he said. “Queensland should be getting its fair share of the GST pie, not playing second-fiddle to a second-rate distribution model designed to dud us.” Chamber of Commerce and Industry WA chief economist Daniel Kiely said the 2018 GST deal is working as intended. “All states can experience boom and bust. It might be Victoria today, it could be WA tomorrow,” he said. “The floor keeps the system fair for all states and territories and gives Governments certainty to plan their budgets.”