Commonwealth Grants Commission raises WA’s share of GST above 75 cent floor for first time since 2018

Western Australia will receive $9.3 billion in GST payments in the coming year and lift above 75 cents for the first time since the floor was put in place, as the body that splits the money warns falling iron ore royalties are starting to impact the State.

In comments sure to spark another round of east coast whinging, the Commonwealth Grants Commission said WA’s ability to raise revenue was falling, increasing its share of the GST and reducing the amount owed to other states including Victoria and NSW.

It has recommended to the Commonwealth that WA receive back 81 cents for every dollar of GST raised in the State during 2026-27.

“Key drivers of changes in state GST shares in 2026–27 include the value of mining production declining, large COVID-19-related health and business support expenses no longer being assessed, and the strength of property markets changing across Australia,” commission chair Mike Callaghan said.

“Given the volatility in state economic and social circumstances, a change in a state’s GST share in 2026–27 cannot be assumed to continue in future years.”

The CGC report released on Friday noted that WA continued to be the fiscally strongest State and said its GST relativity had increased to the same level as NSW as required under the 2018 legislation.

Starting from this year, the 75-cent floor remains in place for all States, and there is now an additional guarantee that no State will receive less entitlement than NSW or Victoria, whichever is lower.

WA will receive $6.6 billion more than it would have without the guarantee, or nearly two-thirds of what it will get this year.

NSW’s share dropped compared to last year, as did Victoria’s, after the elevated levels of COVID spending dropped out of the period used to determine how much each jurisdiction should receive.