Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Hansard source

GST is distributed between the states in accordance with horizontal fiscal equalisation under an agreement between all of the states signed in 1999. In 2005-06 New South Wales will receive the sum of $10.2 billion of GST revenue. I might point out that when that was allocated at last year’s conference not a word of objection was raised by New South Wales in relation to its entitlement. The then Treasurer, Mr Refshauge, did not object to that distribution. The formula of equalisation between the states administered by the Commonwealth Grants Commission has now been operating since 1933. The only reality about distribution between the states is that if one state gets more another state must get less. This is a zero sum gain. The $39 billion is distributed between the states. If one state gets more, another state must get less. The Commonwealth does not keep any of the revenues.

As everybody in Australia knows, GST was introduced to abolish a whole raft of other taxes. Although each and every other state has now agreed to a timetable for the abolition of those other taxes, there is one state in Australia which refuses to name a timetable for the abolition of those other taxes.

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