MYEFO shows GST improvement Mon 22 October 2012 Lara Giddings Premier The Commonwealth Government's Mid-Year Economic and Fiscal Outlook suggests Tasmania's GST receipts will improve by $40 million in the current financial year. The Premier, Lara Giddings, welcomed indications that the GST pool was growing again after a lengthy period of decline which has had a significant impact on the Tasmanian Budget. "While modest, this $40 million increase reverses a trend which has seen Tasmania's share of GST fall dramatically since the height of the Global Financial Crisis," Ms Giddings said. "The increase includes a residual payment left over from 2011-12 as a result of higher than expected GST collections by the Commonwealth last year. "The Federal Government is also forecasting further increases in the overall pool in coming financial years which will help us put Tasmania back on a sustainable Budget footing. "Over the current Budget and forward estimates it is expected that Tasmania's GST receipts will be around $93 million higher than forecast in this year's Budget. "This will allow us to get on with the job of changing Tasmania and building jobs and opportunities for the future. "These signs of recovery only make it more important for Tasmanians to tell Tony Abbott and the Liberals to keep their hands off our share of the GST. "We cannot afford to lose up to $700 million a year, which is the equivalent of $5000 being ripped out of the budget of every Tasmanian household." Ms Giddings said it was important to understand the difference between the increase in the GST pool and the relativities for the states, which are yet to be determined by the Commonwealth Grants Commission. "It is good news that the overall pool has increased and Tasmania can also expect an improvement in our relative share of the GST, which is already factored into our Budget. Ms Giddings said the Tasmanian Treasury had adopted the same approach for forecasting future GST revenues as Western Australia, South Australia, NSW and Victoria. "The Commonwealth uses a relatively simple formula for determining each state's share GST Revenue that does not factor in the fluctuations of the Commonwealth Grants Commission process," Ms Giddings said. "For example, Tasmania's GST relativities have been distorted by the capital funding for the Royal Hobart Hospital project but once this money flows through the system we can reasonably expect our GST payments to bounce back. "Today's results suggest our forecasts for an increase in the overall GST pool are on track, which flies in the face of Peter Gutwein's attack on the integrity of Tasmanian Treasury's modelling. "It confirms again that you simply can't trust Peter Gutwein and the Liberal Party when it comes to the economy."