Dio Wang (WA, Palmer United Party) Share this | Link to this | Hansard source

My question is to the Minister for Finance, Senator Cormann. This government's National Commission of Audit, in recommendation No. 9, proposed an equal distribution of GST off the states on a per capita basis. This position is supported by the Premier of Western Australia, Mr Colin Barnett. On 1 May 2014, Mr Barnett said that the main issue for Western Australia was the GST. The commission advocates sharing the revenue raised through the GST on a per capita basis, supplementing smaller states with extra grants, and Mr Barnett said that he supported that recommendation. Will my fellow Western Australian, the Minister for Finance, commit to this recommendation, delivering to Western Australia an extra $3.7 billion per annum?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Wang and congratulate him on his first question. Senator Wang is, of course, right: the National Commission of Audit made such a recommendation. But, as I am sure Senator Wang would be aware, the coalition went to the last election making a very clear commitment that there would be no changes to the GST under this government—full stop, end of story. If Senator Wang were to consult with his honourable colleague Senator Lambie in relation to the proposition that he has just put to me, I suspect that Senator Lambie, in her capacity as standing up for the good people in the great state of Tasmania, might have a view in relation to these matters that might be slightly at odds with the views that Senator Wang has just expressed.

The truth of the matter is that the GST is a tax which raises revenue which goes to the states. It is true that there are some issues that have been raised from time to time, including by the Premier of Western Australia, Mr Barnett. Mr Barnett is an outstanding Premier for the great state of Western Australia. He does a very good job standing up for the best interests of the people of Western Australia. But, of course, as Minister for Finance in the national government, I have to take responsibility for the country as a whole. In that context, any changes to our tax system would have to flow from a tax review white paper process; it would have to be based on extensive consultation. Whatever changes we might consider as a government in relation to anything related to the tax system that was not part of our pre-election commitments in the lead-up to the last election would have to be taken to the next election in order to get a mandate from the Australian people, including the great people of Western Australia.

Dio Wang (WA, Palmer United Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I thank the minister for his answer. I just consulted my fellow senator, Senator Lambie, and we agree that both Western Australia and Tasmania have not been able to receive a fair share of the GST.

Honourable Senators:

Honourable senators interjecting—

Stephen Parry (President) Share this | Link to this | Hansard source

Order on both sides! Senator Wang, you have the call. Do not worry about the clock; you can continue.

Dio Wang (WA, Palmer United Party) Share this | Link to this | Hansard source

Thank you, Mr President. I refer to the equal distribution on a per capita basis. I believe that even with the equal distribution on a per capita basis, the current collection of the GST from Western Australia is still far from fair given the current distribution. We think that even with the distribution recommended by the Commission of Audit, 37c is not enough for Western Australia. Will the minister commit to joining the Western Australian Premier and the Palmer United Party's stance in distributing a fairer GST to Western Australia?

Stephen Parry (President) Share this | Link to this | Hansard source

Before I call the minister, I was very lenient with the time, Senator Wang. The clock wound down whilst there were a lot of interjections. Your question was a little too long and next time I will be more strict.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Thank you, Mr President, for your indulgence for Senator Wang's first supplementary. I would like all states to get more GST revenue. I would like all states to get more GST revenue on the back of stronger economic growth. Because if we implement our agenda to build a stronger and more prosperous economy, there will be more GST revenue and it will be spread across all of the states. If we get rid of the mining tax, if we get rid of the carbon tax, if we invest in productivity enhancing infrastructure, if we cut red tape costs for business by $1 billion a year, if we do all of the things that we said we would do in the lead-up to the last election, we would have stronger growth which would generate a bigger pie. The problem is when you have to cut up a pie and you want to give individual recipients pieces of that pie. At the end of the day, you need to grow the size of the pie if you want to give people more money because, otherwise, it is a zero-sum game.

Dio Wang (WA, Palmer United Party) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. I think that the report I referred to is a very important report which has been hidden away inside many other recommendations made by the commission. I ask again, will the minister ever commit to this recommendation?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Wang for that question. The report by the National Commission of Audit is publicly available for all to see. I am not quite sure about the suggestion that we have hidden it away. However, the process is, as I have outlined: we said in the lead-up to the last election that there would be no changes to the GST in this term of government. Full stop; end of story. We are, of course, a government that keeps its commitments.

What we have also said is that we would initiate a comprehensive and strategic tax review white paper process in which all of these issues can be ventilated. We have encouraged the state government in Western Australia, as we encourage other state governments, to make submissions to that inquiry and put forward their propositions on how the system can be improved. Whatever decisions we make as a government, we will reflect in the lead-up to the next election as part of our pre-election policies. Hopefully, in good time, the Palmer United Party here in this chamber together with other senators in this chamber will support the genuine reforms that we are putting forward. (Time expired)