Treasurer Rita Saffioti has forecast an increase to Western Australia’s GST share, while criticising “absurd commentary from over east”, in her delivery of the state budget.
Treasurer Rita Saffioti has forecast an increase to Western Australia’s GST share, while criticising “absurd commentary from over east”, in her delivery of the state budget.
In handing down the state budget for the 2025-26 financial year, Ms Saffioti said the government has doubled down its efforts to protect WA’s share of the GST ahead of a Productivity Commission review.
The state’s income from GST Grants in the 2025-26 budget has been estimated at $7.8 billion, 6.5 per cent up from the $7.3 billion estimated in the previous corresponding period.
Under the 2018 GST distribution reforms, every Australian state is to receive a minimum of 75 per cent of its population share of the national pool.
However, the state government said WA’s share was still significantly lower than other states’ despite the 2018 reforms.
Ms Saffioti said without the reforms, the GST would fall to just 18 per cent of WA’s population share.
“It is again important to point out that despite the irrational and absurd commentary from many over east, WA will still only receive 75 per cent of our population share of GST this year,” she said in her speech to parliament.
“In fact, members, our Treasury officials have estimated that Western Australia’s net contribution to the other states last financial year was $39 billion.
“That is, $13,000 that every Western Australian is contributing to the rest of the nation.”
The state government projected that WA would receive $11.6 billion less than its population share of the GST over the five years from 2024-2029.
But WA’s GST share is expected to exceed the 75 per cent floor from 2026-27, according to the budget 2025-26 documents.
“A significant risk arises from the requirement for the Productivity Commission to review the 2018 GST distribution reforms by the end of 2026,” the budget paper read.
“Any changes that may be implemented by the Commonwealth Government in response to the Productivity Commission’s review could alter Western Australia’s GST grant from 2027-28.
“There is an additional risk to the GST reforms if the Commonwealth does not extend the current GST ‘no-worse-off’ arrangements (which has been extended to 2029-30).”
The state government has flagged a likelihood of other states advocating to scrap the 2018 GST reforms if the extension was not greenlit.
“The continuation of the 2018 GST reforms is integral for maintaining Western Australia’s GST revenue,” the budget paper read.
“For example, if the reforms were removed in 2027-28 (following the end of the review), Western Australia’s GST grant would fall from $9.5 billion to $4.3 billion.
“This decline would be even greater if the iron ore price is higher than forecast.”
Federal government grants are estimated to comprise 37 per cent of total general government revenue, or $18.8 billion in 2025-26.
The estimated $7.8 billion in GST grants in 2025-26 would account for 42 per cent of the total of projected Commonwealth grants to WA.
