GST reforms ending ‘unfair’ distribution pass Senate

Josh Frydenberg says every state and territory will be better off with Scott Morrison’s $10 billion GST reforms now law.

Prime Minister Scott Morrison was the architect of the GST reforms while treasurer. Picture: AAP

Scott Morrison’s $10 billion GST reforms are now law after being passed through the Senate this morning.

Treasurer Josh Frydenberg said every state and territory will be better off under the laws, but said the changes would especially fix the “unfair and unsustainable” distribution to WA.

“Under our reforms to the GST, an additional $9bn in extra untied funding will be delivered to the states and territories over 10 years and an additional $1bn in perpetuity once fully implemented,” he said.

Treasurer Josh Frydenberg. Picture: AAP

“The former GST distribution system was not working as intended, with Western Australia recently receiving just 30 cents in the dollar, while other states and territories with far smaller populations received more.

“This was not only unfair and unsustainable, but it threatened the integrity of the GST.”

The new GST redistribution model will have a floor of 75c in the dollar for GST funding. Western Australia’s share of GST revenue fell to 30c in the dollar at the end of the mining boom, sparking calls to overhaul the system.

The Prime Minister was the chief architect of the reforms when he was treasurer in the Turnbull government.

Mathias Cormann. Picture: Kym Smith

Labor came on board with the proposal when the government agreed to include a provision that no state or territory would be worse under the formula.

Finance Minister Mathias Cormann, leader of the government in the senate, said it was a win for WA Liberals who had campaigned for the changes.

Senate unanimously passes legislation to enshrine a better fairer GST sharing arrangement delivering a fairer deal for WA which is good for national growth and leaves every other State and Territory better off. A great team effort by WA Liberal Members and Senators. #auspol

— Mathias Cormann (@MathiasCormann) November 13, 2018

“Senate unanimously passes legislation to enshrine a better fairer GST sharing arrangement delivering a fairer deal for WA which is good for national growth and leaves every other State and Territory better off,” he tweeted after the vote.

“A great team effort by WA Liberal Members and Senators.”