The Turnbull Government is delivering on its promise to fix problems in the system used to share the revenue from the GST leaving all states and territories better off.
This will be the first time real changes have been made to fix problems in how the GST is shared since the GST was introduced almost 20 years ago.
“This problem has been kicked down the road for too long and it is time we now got on and fixed it,” Country Liberals Senator for the Northern Territory, Nigel Scullion, said.
“The NT knows that the system was not working, and that volatility was undermining the ‘fair go’ objective of sharing GST between the states and ensuring all Australians access essential services.”
“The Turnbull Government has developed a plan that is a real, long-term solution, rather than a political quick fix,” Senator Scullion said.
The proposal will involve transitioning to a new HFE system over eight years from 2019-20 in a way that is fair, reasonable and sustainable, and that will ensure all State or Territories are left financially better off.
To assist with the transition to the new system, the Turnbull Government would also ensure that the NT keeps at least their current share of GST, as it did in this year’s Budget in recognition of the unique circumstances faced by the NT in dealing with current GST distribution volatility given its small size, remoteness and relatively large Indigenous population.
“Importantly, this funding would be untied, meaning NT would be able to spend it as they see fit to deliver services including schools, hospitals and infrastructure. This is fair way of ensuring NT gets the services it needs,” Senator Scullion said.
The Turnbull Government will now consult with states and territories to ensure the transition works.
“I am proud to be part of a Government that has a plan to make the system fair and deliver more funding for essential services in the NT,” Senator Scullion said.