Record decline in Australia’s retail spend to hit NT due to dramatic reduction in GST revenue pool
A STAGGERING nationwide plunge in retail spending will result in a ‘big hit’ to the NT’s still unknown GST revenue pool, despite the Territory recording the smallest decrease in the country
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A STAGGERING nationwide plunge in retail spending will result in a “big hit” to the NT’s still unknown GST revenue pool, despite the Territory recording the smallest decrease in the country.
New retail trade data released by the Australian Bureau of Statistics revealed retail spending plunged 17.7 per cent in April nationally and 7.7 per cent in the NT.
But the spending dips in Victoria and NSW, at 21.1 per cent and 17.5 per cent respectively, will impact the NT as per Chief Minister Michael Gunner’s recent quips that the Territory’s GST pool is tied to how much people in Melbourne and Sydney spend.
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Treasurer Nicole Manison said the retail trade statistics were a “prime example” that the NT could expect some big hits to its GST, which accounts for 42 per cent of total revenue.
“We know the GST revenue will take a hit, but what these latest figures also show is the Territory Government’s decision to act swiftly to protect Territory lives and Territory jobs, has meant the impact to our own economy has been smaller than other jurisdictions,” she said.
In dollar figures, the retail spending plunge in Victoria and NSW is $1.6 billion each and in the NT $22 million.
But the pain was not evenly spread, with Darwin City and Waterfront Retailers Association vice chairwoman Darlene Chin estimating some sectors fared far worse than others.
In the NT, spending on footwear and personal accessories fell 50 per cent in April, cafe, restaurant and takeaway food spend fell 16.1 per cent and electrical and electronic goods spend rose 10.3 per cent.
“My feeling is we are going to be having the equivalent of Wet season trade for the rest of the year,” Ms Chin said.
Grattan Institute economist Brendan Coates said NT’s GST pool would be smaller, though Treasury officials would have been prepared to see the numbers reflected in the retail trade data.
“If anything the economy is doing slightly better than we anticipated,” he said.
“The depth of the recession is probably not as deep as it might’ve been (if stricter restrictions had been in place for longer).”
Unlike state final demand, which has shrunk for 10 quarters in a row, retail trade turnover in the NT has remained relatively stable in the same time frame, fluctuating about 1 per cent either way each month.
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