Proposed Commonwealth GST legislation requires amendment

The Hodgman Liberal Government’s clear position has always been that it would not agree to any changes to the GST distribution model that are not in Tasmania’s best interests.

At the Treasurers’ Meeting in Melbourne this morning, I strongly advocated for a ‘no worse off’ provision to be included in proposed Commonwealth GST distribution legislation to ensure that no State or Territory could receive less GST in future than what the current system would provide.

This position was strongly supported by all States and Territories.

It is a matter of great regret that the Commonwealth Government has chosen not to agree to such a sensible amendment in its proposed legislation.

Therefore, the Tasmanian Government cannot and will not support the legislation in its current form and strongly urges the Federal Treasurer to urgently reconsider his position.

We’ve supported the new distribution model previously put forward by the Commonwealth which, on the Commonwealth’s modelling, would leave Tasmania $112 million better off through to 2026-27. That’s a good deal for Tasmania however, a legislated guarantee such as the one proposed today would ensure that the new GST model will always be a good deal for Tasmania, regardless of whether economic conditions change.

What is important is that all States have legislative protection to ensure future Commonwealth Governments, no matter the party, will live up to the commitments made, as there can be a degree of unpredictability around economic modelling. For example, in circumstances where Western Australia’s revenues from mining increase or where Queensland, due to its strong resources base, became the second strongest state, Tasmania could be left worse off.

This is why we are seeking for a ‘no worse off’ guarantee, and this is why we will continue to campaign for it.

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