Treasurer David Janetzki battles GST cut as Qld misses out on $6bn
Queensland has been left behind for a decade as a national GST windfall worth billions of dollars is funnelled into other states, prompting Treasurer David Janetzki to take action.
Queensland has been left behind for a decade as a national GST windfall worth billions of dollars is funnelled into other states.
The Commonwealth Grants Commission will strip $2.3bn in GST revenue from Queensland taxpayers this financial year and $5.3bn over the next three years.
Since 2015-16, Australia’s GST pool has grown by 75 per cent while Queensland’s GST revenue has grown only 28 per cent.
Over the same period CPI has risen 33 per cent – meaning Queensland’s GST increase has gone backwards in real terms.
Treasurer David Janetzki said Queensland’s GST revenue would this year have been worth $22.7bn had the distribution grown in line with national GST payments.
“Queenslanders are missing out on $6.1bn,” he said.
“That’s more than $1000 being taken away from every man, woman and child in Queensland.”
In contrast, GST revenue received by New South Wales, Victoria and Western Australia grew 58 per cent, 118 per cent and 317 per cent respectively over the same period.
Mr Janetzki will on Tuesday task the Queensland Productivity Commission with assessing the economic effect of the GST distribution system and the implication on service delivery and infrastructure.
His recruitment of the Queensland Productivity Commission to investigate the effect of the GST carve-up comes after a spat with Commonwealth Treasurer Jim Chalmers over the scope of a federal review of the GST.
Mr Janetzki argues the terms of reference issued by Mr Chalmers have been “severely narrowed” from those unanimously agreed to by all state and territory treasurers.
He said the federal Productivity Commission was not able to evaluate the Commonwealth Grant Commission’s methodology decisions, nor if there is a better way to distribute the GST to support national economic growth and financial sustainability of states.
“If Jim Chalmers won’t ask the right questions of his productivity commission, then I will ask them of ours,” Mr Janetzki said.
“It is clear the current system to calculate GST distribution is seriously flawed.
“How can a methodology be fair if it creates fiscal disincentives for states to make good policy decisions and support the industries, like the gas and coal industries, that build national wealth?
“A system built on the original intent of the GST should recognise the unique challenges posed by Queensland’s decentralised population and all Queenslanders should be able to receive comparable levels of health services, education, justice, welfare and public housing, regardless of where they live.”
The Queensland Productivity Commission will report back to Mr Janetzki with an interim report in February and a final report in April.
Originally published as Treasurer David Janetzki battles GST cut as Qld misses out on $6bn
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