South Australia appears on a collision course with Western Australia over GST funds, with new Labor Treasurer Stephen Mullighan declaring the state must get a bigger slice of the pie.
Handing down the state budget on Thursday, Mr Mullighan said SA would get an additional $900 million in GST returns over the next four years on the back of increased national collections.
But he said a recent move by the commonwealth to revise down SA’s share amplified the budget impact of recent changes to GST arrangements.
Those arrangements ensure WA keeps at least 70c of every dollar of revenue collected.
“Next year, these revised arrangements will mean our state will be $289 million worse off than under the original GST deal made in 2000,” Mr Mullighan said.
“This loss is masked by a temporary no worse off commitment that ends in 2027.
“South Australia, like other states and territories, faces a severe revenue shortfall in the future unless this is remedied.”
WA recently posted a $5.7 billion budget surplus on the back of better-than-expected tax receipts, a lift in the iron ore price and an increase in the national GST pool.
Premier Mark McGowan said the WA budget would make other treasurers “green with envy”, declaring other states had not run their finances as well.
But Mr Mullighan said other states were handing over GST revenue at a time when WA was experiencing one of the greatest ever mining booms.
He said the situation had gone from being unsustainable to absolutely outrageous.