GST, fracking link ruled out by Hodgman

THE State Government will not reconsider its moratorium on fracking in the light of a threat from Federal Treasurer Scott Morrison that it could prompt a cut in GST distribution.

Premier Will Hodgman’s rejection came after Mr Morrison said he believed it was unfair some states had imposed moratoriums on fracking and yet were still receiving more GST revenue than they raised.

Fracking is a way of searching for oil and gas that has been banned in Victoria and restricted in NSW.

Mr Hodgman said there was no connection between GST and fracking, on which Tasmania imposed a five-year moratorium in 2015.

“The GST should be determined on the basis of delivering equitable services to Australians no matter where they live not whether or not a state bans fracking; that was not part of the deal and never will be,” Mr Hodgman said.

“If the Commonwealth and any other state wants to look at how you can best get your affairs under control, you can look at Tasmania.”

The comments come as the State Government finalises a submission to the Productivity Commission inquiry into the GST and West Australian Premier Mark McGowan renews his pitch for a greater share for the state with a 12 point plan. Mr Morrison said the fracking issue was worth a proper look.

“The Productivity Commission is looking at whether the way the states and territories operate is giving them a leave pass under the GST formula not getting on and doing things,” Mr Morrison said.

“When you have states that get on and do things should they be penalised by getting less GST?”

He said Western Australia was penalised for making the most of its natural resources.

Treasurer Peter Gutwein said the State Government would fight to ensure Tasmania received its fair share.

“Let me give a two-point plan to the Western Australian premier, manage your budget and ensure that you don’t spend more than you earn,” Mr Gutwein said.