Canberra to reveal GST changes
AN overhaul of how $65 billion in GST revenue is split between the states will be revealed next week, once the Federal Government is able to resolve an internal debate on the carve-up.
It is understood Cabinet considered the issue twice this week, including at a special meeting on Wednesday night, as ministers try to limit the political fallout from changing the states’ key cash pipeline.
It is believed a significant compensation package will be on the table for the states which lose money from the Government’s plan, based on the recommendations of the independent Productivity Commission.
Victorian Treasurer Tim Pallas wrote to his federal counterpart, Scott Morrison, last night requesting an “urgent briefing” on the commission’s report, after the Federal Government had pledged to brief the states before its release.
Mr Pallas said the commission’s draft proposals posed “significant risks” to Victoria that could see it lose between $695 million and $1.6 billion in the next financial year.
“Victorian does not consider that the case for change has been presented, and supports the current GST distribution methodology,” he wrote.
The reforms will be released less than a month out from five by-elections across four states, where Prime Minister Malcolm Turnbull will try to increase his one-seat majority.