It’s a tremendous amount of money. Money the government took from you and every other Aussie and visitor via the goods and services tax (GST) over the year.
And that’s after taking a large chunk of your paycheque via income taxes, mind you.
Until 2000, that additional 10% tax (which is far higher on some goods like alcohol and tobacco) didn’t exist. But don’t expect the government to give that money back to consumers to spend or save how they see fit.
Once you give government a new revenue source, rest assured, the pollies will find a way to spend it…and then some.
And just how to divvy up the spoils between the states has caused a running debate since the inception of GST.
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A closer look at the handouts…
Below is the detailed list of GST state payments for this year and next:
NSW: $19.269 billion (up from $18.257 billion)
Queensland: $14.558 billion (down from $14.630 billion)
Northern Territory: $2.860 billion (up from $2.792)
Victoria: $17.734 billion (up from $17.074 billion)
South Australia: $6.946 billion (up from $6.815)
Western Australia: $3.694 billion (up from $3.271)
ACT: $1.435 billion (up from $1.322)
Tasmania: $2.513 billion (up from $2.469)
Where’s my money going this time?
The latest shake up is sending a lower share of GST revenue to Queensland and more to New South Wales in 2019/20 — according to a Commonwealth Grants Commission.
According to AAP, the GST boost is largely driven by the state receiving fewer federal government payments.
Other potential recipients of GST revenue in the coming financial year are Queensland, South Australia, Tasmania and the Northern Territory — receiving 0.1% less.
However, this will still mean more money overall from a larger GST pool.
This takeaway will hit most significantly in Queensland — in their GST shares falling from 22% to 21.1% next year — in dollar terms, from $14.63 billion to $14.56 billion.
State and territory payments will also be topped up by the federal government, under a package that cleared parliament in November.
Victoria is expected to produce more of its own revenue in 2019/20, due to strong growth in home sales. Its GST share will increase slightly — from 25.6–25.7%, with revenue gains offset by higher service industry costs in the state, including wages.
However, with housing trends declining, whether this will hold true is another issue…
What’s the reason for the new divvy-up?
The very controversial issue of higher coal production, higher coal prices and a decline in natural disaster expenses are closely tied to the reduction.
Additionally, the laws were prompted by WA receiving a measly 30 cents for every dollar of GST revenue it collected, while others received more.
However, under a package cleared in November, state and territory payments will be topped up by the federal government.
What exactly it’ll be used for, is uncertain. But what is – is that it’s out of your hands.
Like they say, in life, two things are certain — death and taxes.
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