What is it?

The Goods and Services Tax is a broad-based tax of 10 per cent on most goods, services and other items sold in Australia. The GST pot is estimated to reach $103 billion in 2026-27, distributed to the States and Territories by the Commonwealth Grants Commission.

Under the current formula, WA is set to receive $9.3b, Victoria $27.8b, NSW $26.1b, Queensland $18.4b, SA $9.5b, NT $5.1b, Tasmania $3.9b and the ACT $2b.

The 2018 deal

WA’s return had plummeted below 30¢ for every dollar of GST raised.

The GST deal negotiated by Scott Morrison and signed off by Malcolm Turnbull and Mark McGowan legislated a minimum 75¢ floor and a temporary no-worse-off guarantee to top up all States out of the Federal Budget.

The NWOG has blown out from an initial estimate of $2.3 billion to an estimated cost of almost $60 billion by 2030.

Impact on WA

Without the 2018 reforms, WA’s population share of GST revenue would fall from 82 per cent currently to 24 per cent in 2026-27.

The State Government argues that no other State has ever received less than an 82 per cent share.

Why is the deal being reviewed?

A review after five years was part of the original deal.

The Productivity Commission will hand down its final report by December 31 but any change will need legislation to pass Federal Parliament.