Hands off: McGowan warns states on GST grab
Premier Mark McGowan has warned his fellow premiers that Western Australia won’t let its share of GST be eroded, despite boasting a multi-billion dollar state budget surplus.
Mr McGowan, who is also treasurer, on Thursday handed down his third state budget which included a $3.3bn net operating surplus for 2023-24.
But in his budget speech, Mr McGowan said it would be “contemptible and offensive” for his interstate counterparts and commentators to try and undo 2018 reforms to the goods and services tax allocation, which resulted in WA’s share increasing to 70c in the dollar.
“Other states will attempt to erode Western Australia’s share of GST in upcoming reviews.
We cannot let that happen. We will not let that happen,” he said in his budget speech.
He said he had budgeted for “our very own GST fairness fighters”, a dedicated team within Treasury to ensure WA kept its rightful share of GST.
Mr McGowan said WA’s iron ore is delivering an extra $22bn in GST to the other states.
“All states and the Commonwealth have benefitted from the efforts WA has put in to grow our resources sector over decades,” he said.
“Even with the GST floor, WA Australia still continues to receive the lowest GST share in the nation per capita, by a long, long way.”
Mr McGowan said he “took comfort” in assurances from Prime Minister Anthony Albanese and federal Treasurer Jim Chalmers that there wouldn’t be any changes to the agreement, which will see the floor raised to 75c in 2024-25.
“It’s a red line that should not be crossed by any future federal government.”
Reward for Western Australians
Mr McGowan said Thursday’s state budget was also paying back voters who had resoundingly returned his Labor government two years ago.
He announced another $400 electricity rebates for WA residents, on top of the $350 energy bill assistance announced by the federal government on Tuesday night.
“In March 2021, Western Australians voted to stay the course … this budget is about repaying the faith Western Australians placed in our government,” said Mr McGowan.
“Amid the rugged economic conditions worldwide, Western Australia walks tall.”
In the year to March, WA generated $272bn in exports – up 13 per cent.
That figure has been propelled by the price of iron ore, which was sitting at $US106.85 ($A158.25) on Thursday.
Other key takeaways from the WA budget include net debt falling to $27.9bn, down from a forecast $31.1bn, but that is also tipped to rise up to $35.9bn in 2026-27.
The net operating surplus for 2022-23 also came in a $4.1bn, up from a forecast $1.8bn in December.
A $715m cost of living relief package will see WA residents benefit from a $400 electricity credit, on top of a $350 federal government energy rebate announced in Tuesday night’s budget.
While about 90,000 small businesses who use up to 50MWh of power per year will be eligible for a $650 credit.
It’s the McGowan Labor government’s seventh budget, sixth consecutive with a surplus.