SA Treasurer Stephen Mullighan vows to fight GST ‘scandal’

Stephen Mullighan has drawn the battle lines as he takes over SA’s books, vowing to fight the GST “scandal” while demanding immediate cost of living relief in Tuesday’s federal budget.

South Australia is at risk of losing $280m a year under the “scandalous” GST carve-up, new state treasurer Stephen Mullighan has warned, while demanding immediate cost-of-living relief in Tuesday’s federal budget.

In his first detailed interview since taking over SA’s books, Mr Mullighan has vowed to continue the fight for the state’s fair share of GST.

“This is a catastrophic financial risk to all state and territory governments barring Western Australia,” Mr Mullighan told The Advertiser.

“The figures I’ve seen is that if it wasn’t for the temporary guarantee of GST top-up payments (until 2026), this financial year South Australia would be $280m worse off.”

New state treasurer Stephen Mullighan says the GST deal is a ‘scandal’.

In July 2018, the federal government introduced a GST “floor”, meaning all states could not receive less than 70c for every dollar of the tax it sends to federal coffers.

State treasurers around the country have argued WA should earn less GST because of its ability to rake in billions in royalties from high iron ore prices.

Mr Mullighan said the system meant WA was $4.4bn better off each year than all states and territories.

“All of the other states and territories under these new arrangements are unfairly expected to subsidise WA’s budget position. It is an absolute scandal,” he said.

Prime Minister Scott Morrison has called the GST deal a “forever” one. Picture: NCA NewsWire / Jeremy Piper

In Perth earlier this month, Scott Morrison said the GST was a “forever deal” that was about “fairness” and in the national interest.

Mr Mullighan called for immediate relief for Australians struggling to make ends meet amid rising cost of living, including soaring fuel prices.

“Wage growth in South Australia has lagged the nation for the last two years, so real wages are actually going backwards when it comes to purchasing power for households,” he said.

“The short term pressure on the Coalition is going to be how they can demonstrate some cost of living relief to households in the immediate term.”

Federal Treasurer Josh Frydenberg running around Lake Burley Griffin in Canberra ahead of announcing his federal budget on Tuesday. Picture: NCA NewsWire / Gary Ramage

Mr Mullighan said ordinary tax cuts would not be sufficient as people needed “relief right now, when it’s costing people up to $150 to fill up their car”.

“Announcing a bit of tax relief that might be accessible in the next few months is not going to meet that need,” he said.

The new state treasurer also demanded a short to medium term plan for shipbuilding in SA in the absence of a signed submarine construction program.

“We don’t have a firm replacement here in SA. We’re lacking that growth in the workforce right at the same time the economic stimulus from the Covid spending is coming out of the economy, so it’s a bit of a double barrel economic risk.”

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Originally published as SA Treasurer Stephen Mullighan vows to fight GST ‘scandal’