Western Australian Premier Roger Cook has launched a fierce attack on a Productivity Commission report examining how Australia's goods and services tax revenue is distributed, calling the authors "east-coast clowns" while states struggling with underfunding argue the current system entrenches inequality.
The commission's interim report revealed that Western Australia received enough GST revenue to meet 113 per cent of its assessed fiscal needs in 2024-25, compared with 98 per cent for other states. The federal government topped up the remaining 2 per cent. WA is the only state or territory to benefit from the 2018 changes to how the GST is carved up, according to the commission.
A System Under Scrutiny
The GST distribution is supposed to help each state and territory provide services and infrastructure to the same standard. But the current arrangement has created a sharp divide between resource-rich Western Australia and states struggling to fund essential services.
Cook said any changes to the GST distribution would unfairly punish WA for its success "simply to prop up other lazy states." He described the commission's proposed options as "dodgy, deceitful, and quite frankly dumb." "It's a sign that these east-coast clowns simply do not understand Western Australia; they have no Western Australian representative, and no idea," he said.
The premier also said the Productivity Commission's report was "an attack on every hard-working Western Australian." He said he spoke with Prime Minister Anthony Albanese on Friday and that Albanese told him the arrangements in place for Western Australia would remain. "And this report, a product of the Morrison Liberal government's legislation, does not reflect the federal government's position," Cook said.
Other States Push for Reform
NSW Premier Chris Minns said the commission's interim report was a clear indicator that change was needed. "Every state and every territory except Western Australia wants change, and I'd like to see it too," he said. "We're now in a situation where Western Australia is so wealthy and so rich that they're competing and bidding on New South Wales Rugby League games and putting tens of millions of dollars on the table. That's how rich they are."
Minns drew a provocative comparison: "I mean, you're seeing similar behaviour from Gulf States like Saudi Arabia and the UAE and Dubai. They're almost for the same reason because they're digging up natural resources and they've got billions of dollars to spend."
South Australia's Treasurer Tom Koutsantonis said the system was unfair. "It's made Australia unfairer, and it's made Western Australia richer. Unfair," he said. Tasmanian Treasurer Eric Abetz argued that GST distribution should return to pre-2018 arrangements. "It is critical for Tasmania's capacity to fund our hospitals, schools, police, roads and the essential services Tasmanians rely on every day," he said.
The Revenue Impact
WA Treasurer Rita Saffioti said reverting to pre-2018 GST distributions would remove about $6 billion in revenue from WA each year and disincentivise economic development. "It's simply illogical; it doesn't support economic growth," she said. "You'd expect a productivity commission to focus on policies that support productivity."
The commission argued in its interim report that the GST was intended to provide an equal quality of services across Australia, rather than punish or incentivise state developments. "Where a state receives a smaller share of the GST pool, it reflects a need for less support to deliver this level of services," the interim report said.
Before the interim report was released, Albanese said WA would get a "fair deal." "You will get your fair share, because your work and what you contribute to the national economy really counts," he said.
Political Battle Lines
Prominent federal WA Liberal MPs Andrew Hastie and Michaelia Cash said they had drawn a "clear line in the sand" that WA must be no worse off under any proposed changes. "Over our dead bodies will they take a cent from Western Australia," Cash said. Hastie said Albanese and Jim Chalmers had repeatedly promised to protect the deal. "We will hold them to that promise every day between now and the final report in December," he said.
WA Opposition Leader Basil Zempilas said it was a "dark and dangerous day for Western Australia." "Roger Cook is asking us to trust Anthony Albanese for the long-term future of Western Australia and our fair share of the GST deal," he said. "Anthony Albanese, who backtracked on negative gearing, who backtracked on capital gains tax, how can any West Australian trust that he is not going to backtrack on what is right for West Australians?"
The media conference held by Cook and Saffioti was evacuated after the fire alarm went off at Dumas House. "Yeah, while we're gone, they're going to take our GST," Saffioti said, jokingly.
Why This Matters:
The battle over GST distribution reveals fundamental tensions about fairness and equity in Australia's federal system. While Western Australia benefits from mining royalties tied to natural resources that belong to all Australians, states like Tasmania and South Australia struggle to fund hospitals, schools, and essential services for their residents. The commission's finding that WA receives 113 per cent of its assessed needs while other states get 98 per cent raises questions about whether the current system truly delivers equal access to public services across the country. With the final report due in December, the debate will test whether Australia's federal compact prioritizes resource-rich states' prosperity or ensures every Australian, regardless of where they live, can access comparable levels of education, healthcare, and infrastructure. The outcome will shape funding for essential services that millions of Australians depend on daily.