- Productivity Commission’s interim report into its review of the 2018 GST Reforms released
- Report recommendations could rip up to $6 billion per year from Western Australia’s economy
- Changes put Western Australia’s position as the engine room of the nation at risk, restricting the State’s ability to fund major economic infrastructure
- Cook Labor Government continuing to put WA first and fight hard to retain current GST distribution arrangements
Western Australia will lose between $1 billion and $6 billion a year if any of the recommended changes from the Productivity Commission’s interim report into the 2018 GST Reforms are adopted.
As part of the interim report released today, the Productivity Commission has recommended options including a return to the pre-2018 reforms, which could result in WA’s per person share of the GST plummeting from 82 per cent to just 24 per cent.
The interim report recommends returning to full equalisation, which penalises states for growing their economies and in particular, their resources sectors.
WesternAustralia makes the largest per capita contribution to the national economy and accounts for almost half of the nation’s goods exports.
A loss of $6 billion a year would be equal to the cost of WA’s public education system or the wages of the nurses, doctors, and medical staff in its public hospitals.
It is also equivalent to the State’s record investment in economic infrastructure, including WA’s ports, water and electricity, and roads that support the State and national economy.
The Productivity Commission’s interim report contradicts the recommendations from its 2018 inquiry, which found the previous GST distribution system was broken and needed to change.
The 2018 report recommended going beyond the reforms adopted by the Commonwealth through a reasonable level of equalisation that better balanced equity and productivity.
The Cook Labor Government provided its formal submission to the Productivity Commission in March, supported by the WesternAustralian People’s Submission, which compiled the views
of more than 6,000 people, with overwhelming support for maintaining the current GST deal.
The Cook Labor Government will ramp up its campaign to ensure the current GST distribution arrangements are retained.
The Productivity Commission will provide its final report to the Commonwealth in December. The Commonwealth will then decide if the report’s recommendations should be acted on.
The Cook Labor Government is calling on Western Australians to join the fight to retain WA’s GST deal. For more information, visit wa.gov.au/GST
As stated by Premier Roger Cook:
“Western Australia is the economic powerhouse of the nation. When WA does well, so does Australia.
“An attack on WA’s GST deal is an attack on all Western Australians.
“My WA Labor Government will always put WA first and fight for our GST deal.
“We’ll accept nothing less than the current deal and Western Australians will accept nothing less.
“Over the past decade, my government has made it clear – WA Labor secured our GST deal, and we will fight for it to remain.
“Already 6,000 Western Australians have made their voices heard.
“It’s up to every Western Australian to join the fight to stop an east-coast-dominated Commission from tearing up this deal and punishing our State’s hard economic work for the good of Australia.”
As stated by Treasurer Rita Saffioti:
“The Cook Labor Government will always put Western Australia first, which is why are going to fight harder than ever to protect Western Australia’s current GST arrangements.
“Western Australia has worked hard to become the economic powerhouse of the nation, creating the wealth that benefits all Australians.
“Our case to the Productivity Commission has been clear from the start: any threat to Western Australia’s GST deal is a threat to the national economy.
“The Productivity Commission is recommending changes that would see Western Australia lose between $1billion and $6 billion a year.
“Of the three recommendations, our preference is none of the above – we want to keep the existing deal.
“That’s money that we invest in critical economic infrastructure like ports, roads, energy, and water for major projects that fuel the entire national economy.
“It also funds our schools, hospitals, and other essential services Western Australians deserve.
“Western Australia already subsidises the rest of the nation through GST to the tune of billions of dollars, contributes more than any other state or territory in company tax, and our resources industry accounts for almost half of the nation’s exports.
“This issue is one of the biggest threats facing our State’s economy, which is why we’re going to fight harder than ever to protect Western Australia’s GST deal.”
