24 May 2024

Council on Federal Financial Relations Statement

The Council on Federal Financial Relations continues to discuss the implications of the recent High Court decision in Vanderstock & Anor v State of Victoria.

The Commonwealth, state and territory treasurers agree that a substantial decrease in state and territory revenue bases is not in the interests of the Australian federation.

The Commonwealth supports states and territories maintaining stable revenue bases for the delivery of essential community services and infrastructure, which benefit all Australians.

The Commonwealth Government is working with the states and territories to ensure they have secure own‑source revenue bases and will continue to explore options, including legislative options, to protect state revenue sources.

The Commonwealth Treasurer notes the Franchise Fees Windfall Tax (Collection) Act 1997 was introduced following a previous constitutional challenge to various business franchise fees on tobacco, alcohol, and petroleum products in the states. The Commonwealth windfall tax applied to claims for refunds in respect of those taxes collected prior to the challenge. The Commonwealth will consider similar actions, if required in future.

States and territories are also working independently and collaboratively towards ensuring revenue streams are secure, efficient and equitable.

All treasurers agreed to continue working together to provide security and certainty for revenue to fund schools, hospitals, roads and other services and infrastructure across Australia.