10 hours Ago By Andrew Brown and Rachael Ward
Victorians are the big winners from the latest carve-up of GST revenue, but their gains will come at the expense of Queenslanders. Login or signup to continue reading Every jurisdiction but the Sunshine State will get a financial boost from the GST after the Commonwealth Grants Commission handed down its latest report into how the tax proceeds will be divided up in the new financial year. Victoria will get an extra $3.
6 billion from the GST, due to its booming population and being less reliant on royalties from mining. NSW will gain a further $942 million to the state's coffers, with WA also getting $395 million extra for 2025/26. However, Queensland will get $1.
2 billion less from the latest carve-up compared to the previous year. "This is largely because higher coal prices and a higher average coal royalty rate significantly increased its capacity to raise revenue from coal royalties," the commission said in its report. Commonwealth Grants Commission chair Mike Callaghan said Queensland's mining boom had also contributed to the reduction.
"Queensland has had the largest amount of coking coal," he told AAP. "If a state has a growth in revenue, it doesn't need as much as GST distributed. "Mining states going through a mining boom results in a reduction with their GST and because it's a fixed pool, those states that don't have any get extra.
" But Queensland Treasurer David Janetzki said the state was not getting its fair share of the money. "This recommendation would severely compromise Queensland's capacity to deliver essential services and infrastructure for our growing state," he said. "This must be called out for what it is, shonky shifting of Queenslanders' money for a better payout for New South Wales and Victoria.
" Mr Janetzki has called on federal Treasurer Jim Chalmers to reject the recommendations of the commission's report, saying Queensland had the biggest reduction in revenue since the GST was introduced in 2000. Assessments for GST funding are done through a rolling three-year average, with COVID lockdown years now being excluded from calculations. Mr Callaghan said the downturn seen in Victoria during the pandemic had now dropped out of assessments and the subsequent population rise meant there was a need to boost GST in the state.
"If there is a significant increase in GST need, and other states have a fall, everything in the GST is relative," he said. The carve-up frequently comes under fiery criticism from state and territory leaders. Labor leaders in the two most populous states got stuck into a war of words with each other in 2024 when NSW Premier Chris Minns described Victoria as a "welfare state".
Former Victorian treasurer Tim Pallas returned fire, claiming Mr Minns did not understand the GST system. It's also a major talking point in resource-heavy Western Australia, which benefit from a boost in 2018 under the coalition. Prime Minister Anthony Albanese vowed not to change the arrangement in the west and in February 2024 even signed the promise onto the arm of a journalist while visiting Perth.
NSW and Victoria have been pushing for a per-capita distribution while former Queensland's former Deputy Premier Cameron Dick hit out at the commission's decision to examine how coal royalty revenue is calculated. States and territories rely on GST for funding for financial support to fund major expenditure including health, education, infrastructure and housing. Australian Associated Press DAILY Today's top stories curated by our news team.
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