Turnbull Government navigating political minefield of GST carve-up
A MASSIVE overhaul of how $65 billion in GST revenue is split between the states will be revealed next week, once the Turnbull Government is able to resolve a difficult internal debate.
National
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A MASSIVE overhaul of how $65 billion in GST revenue is split between the states will be revealed next week, once the Turnbull Government is able to resolve a difficult debate on the carve-up.
The Herald Sun understands Cabinet considered the issue twice this week, including at a special meeting on Wednesday night, as ministers try to limit the political fallout from changing the states’ key cash pipeline.
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It is believed a big compensation package will be on the table for states that lose money from the government’s plan, based on recommendations of the independent Productivity Commission.
Victorian Treasurer Tim Pallas wrote to his federal counterpart Scott Morrison last night requesting an “urgent briefing” on the commission’s report. The states were promised a briefing before its release.
He said the commission’s draft proposals posed “significant risks” to Victoria which could see the state lose between $695 million and $1.6 billion in the next financial year.
“Victoria does not consider that the case for change has been presented, and supports the current GST distribution methodology,” Mr Pallas wrote.
The controversial reforms will be released less than a month out from five critical by-elections across four states, where Prime Minister Malcolm Turnbull will try to increase his one-seat majority.
Originally published as Turnbull Government navigating political minefield of GST carve-up