Labor quibbles GST guarantee, not dollars

Pat Griffiths
Shadow Treasurer Chris Bowen says Labor is not worried about the GST, but about funding sources

Labor has assured voters in upcoming by-elections across Australia it won't accept any deal that sees them worse off under the federal government's radical shake-up of GST funding levels.

Shadow Treasurer Chris Bowen said the opposition was responding constructively to the government's changes to the 10 per cent tax on goods and services, but was entitled to be cynical.

"The dollars aren't the major point of disagreement between us and the government here," Mr Bowen told Sky News on Sunday.

"The major point of disagreement is that we're concerned that the money could be clawed back through other means."

The government on Thursday announced the biggest change to the distribution of the GST in 18 years, with new benchmarks and a boost to its funding pool.

Mr Bowen equivocated when repeatedly asked whether Labor supported the level of funding the government had promised as part of the changes.

"This is not actually a reform. (Treasurer) Scott Morrison has thrown money at this problem," he said.

Instead, he said Labor supported the eventual floor of 75c in every GST dollar for Western Australia.

"Western Australia has legitimate grievances and we've been saying those grievances should be addressed," he said.

Labor is concerned the extra funding for the GST pool could result in cuts to sectors like health and education.

It is wary of taking the government at its word, ahead of a touted intergovernmental agreement on the issue later this year.

"Premiers and chief ministers would be very entitled to be sceptical and wanting as strong a guarantee as humanly possible," Mr Bowen said.

"When it comes to good faith, there's a lot lacking between this treasurer and the state and territory jurisdictions."

Labor is digging into the detail of the government's changes, and says it will consult with states and territories while doing so.

Mr Bowen also ruled out any changes to the GST rate or expansions to its base should Labor win the next federal election.