States and Territories are projected to receive $5 billion in additional GST funding over four years courtesy of measures implemented by the Turnbull Government.
These measures include improving the integrity of GST on property transactions and applying the GST to digital products and services and to low value goods imported to Australia.
In 2018-19 alone, these compliance and integrity measures have increased the size of the GST pool of funding by $1.865 billion - more than half of the total increase in the GST pool from the previous year.
The increase was detailed in the Commonwealth Grants Commission's recommended GST relativities for 2018-19, announced at today's Council on Federal Financial Relations meeting with State and Territory treasurers.
Those recommendations show the majority of States would receive an increase to their GST distribution.
Treasurers enjoyed productive discussion on the new National Housing and Homelessness Agreement to ensure funding can flow from 1 July 2018. The agreement would give the States and Territories more than $7 billion in housing funding over the next five years, and an additional $620 million in homelessness funding.
The States and Territories were also updated on the establishment of the National Housing Finance and Investment Corporation including the affordable bond aggregator enabling cheaper financing for community housing.
The Council welcomed South Australian Treasurer, the Hon Rob Lucas MLC, who returns to the forum of Treasurers after the recent SA election ending a 16 year absence. The Council also welcomed Queensland Treasurer, the Hon Jackie Trad MP to her first meeting after accepting the Treasury portfolio in December.
The Treasurer also congratulated the Hon Peter Gutwein MP on his re-election and reappointment as the Tasmanian Treasurer.
Treasurers received an update on the economic and fiscal outlook. We are seeing improved economic conditions across most of the States and Territories and are positive about the outlook for the national economy, with recent improvements in non-mining investment, stronger consumer spending and continued infrastructure spending.
The Chair of the Board of Taxation, Mr Michael Andrew AO, presented on the opportunities to reduce red tape for national employers by harmonising disparate state tax laws. He also presented on the impacts of the black economy on the States and Territories, and ways they could more fully exploit the variety of tools and resources (licensing, tax information, and enforcement) they separately possess to cooperatively combat the black economy.
It was a constructive meeting and I thank all Treasurers and presenters for their contributions.
For more information visit the Commonwealth Grants Commission's 2018 Update Report.