The GST is broken, and hurting NSW and Victoria badly

March 25, 2026 — 5:00am

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This is the first comment to the Productivity Commission’s inquiry into how GST revenue – about $100 billion a year – is shared among the states and territories.

“WA already pay more GST contributions than all of Australia. We desperately need more GST to fix our critically ill hospital and health system, our schools are crumbling, lacking the funding to fix them and infrastructure including house [sic] is desperately lacking,” the West Australian resident notes.

To quote Luke Skywalker: Impressive. Every word in that sentence was wrong.

By any measure, the largest share of GST comes from NSW consumers. They’ll pay around $32 billion this year (Victorians will pay about $25 billion) compared with the $10 billion or so handed over by West Australians.

The WA state government is expecting a budget surplus of $2.4 billion this year. If the state’s hospital system or schools or infrastructure are crumbling, a government that has been running surpluses for seven years clearly has the cash on hand to deal with these issues.

That it hasn’t is not for want of GST.

When the GST was introduced by John Howard in 2000, all of the revenue raised by the new tax was to be shared by the states and territories. It would be their guaranteed source of funding.

That someone actually believes WA........

© The Sydney Morning Herald