Dylan Caporn: Proof east coast GST leeches have nothing to cry about

West Australian

7 hours ago

WA's State Budget has become home to somewhat of an annual tradition — the GST stoush.
East coasters look on as WA celebrates another budget surplus, fuelled by iron ore royalties and the treasurer issues a Gandalf-like warning to those States with envious eyes.
'It is again important to point out that despite the irrational and absurd commentary from many over east, WA will still only receive 75 per cent of our population share of GST this year,' Rita Saffioti told Parliament on Thursday.
Later, she went further: 'If you don't support a successful WA, the whole nation is penalised.'
Buried in the Budget papers was a significant rebuttal to those east coast whingers arguing against WA receiving a top up to the 75 cent floor.
'Every State, not just Western Australia, has benefited from high iron ore prices . . . the other States can now expect to receive about $30 billion extra GST over 2020-21 to 2028-29,' the Budget said.
'The three largest iron ore miners paid $17 billion to the Commonwealth in company tax in 2023-24 on its Western Australian operations, while the cost of the no-worse-off guarantee was only $5 billion that year.'
Put simply, WA works so you don't have to.
There are sobering numbers for other jurisdictions in the document, with every Tasmanian costing the Commonwealth Budget $12,130 each — compared to WA's per capita contribution of more than $13,000 per person.
Based on that figure, West Australians should have a vote in this month's Tasmanian elections.
As of next financial year, Australia's leech — Victoria — will earn more from the GST than it sends to the national pool, getting $1.06 for each dollar it contributes.
A system which compensates Australia's second most populous State — one crippled by Government debt projections — is clearly not working.
Victoria's boost has come as a change in the GST methodology to include pandemic-era business support and health expenses, meaning those States which spent more are going to get more in grants.
'This method change does not acknowledge the different policy approaches of States when responding to COVID-19, and penalises States that took actions that prevented the spread of COVID-19 in the community,' the Budget stated.
It's further proof that it's going to take WA and WA alone to stand up for ourselves on this question of fiscal dignity.
But as the second term Albanese Government looks for something to occupy itself with, Treasurer Jim Chalmers has decided after two decades of limp, stagnant policy ambitions in Canberra, he will grab onto the third rail of Australian politics — tax reform.
In front of the Press Club last week, Chalmers said he had an appetite to be 'bold and ambitious', and did not shoot down changes to the GST model ahead of a reform round table in August.
As other States seek to reap the rewards from WA's efforts, our Government must have a seat at the table. Only a West Aussie can truly fight for our fair share.