“If, from the more wretched parts of the old world, we look at those which are in an advanced stage of improvement, we still find the greedy hand of government thrusting itself into every corner and crevice of industry, and grasping the spoil of the multitude. Invention is continually exercised, to furnish new pretenses for revenues and taxation. It watches prosperity as its prey and permits none to escape without tribute.” – Thomas Paine
Liberals WA has a posting (below) up on their Facebook page today complaining of the way in which GST revenue from that state is distributed across the nation. The reality is that of all revenue raised by this tax in the state, 38c (soon to go down to11c) in the dollar goes back there. The rest goes to other states.
Being Liberals, they tend to have a short attention span and have not gone on to check just how badly WA is treated by the tax system as a whole. The same principle applies across the entire system; it is not just GST, but income, company and every other tax that rips them off. The figure of $3.6 billion is only a small part of it; the total figure is around $20 billion from all taxes.
This issue was first raised by Liberal Democrat senator elect, David Leyonhjelm in the lead up to the West Australian senate election #2.
This welfare system involves two states – Western Australia and New South Wales – transferring funds to the other states and territories. WA transfers $20 billion a year, equivalent to more than $8,000 a year from each West Australian, while NSW transfers more than $2 billion a year, over $300 per person.
Out of this system Tasmania and the Northern Territory draw nearly $4 billion a year each. That means each Tasmanian, rich or poor, gets nearly $8,000 per year from the people of WA and NSW while Northern Territorians get more than $16,000.
The state-to-state welfare system is complicated and to unravel it is no easy task. Some think it simply involves the GST, but that only plays a small part. Of the $8,000 a year that each West Australian transfers to the east, only $600 is a result of paying GST to Canberra.
During the senate rerun, Clive Palmer threw huge resources at the issue and made significant inroads as a result. We all remember those Youtube videos of Canberra snatching bread from hungry babes. Clive, of course didn’t actually present a policy on the issue and tell the people what he was going to do about it; there was no need. The implication that he disapproved of it was enough.
In view of this, it’s no wonder the WA Liberals have now found sufficient voice to bitch about it.
The problem they have with this, is that their version of ‘the world’s greatest treasurer’, Joe Hockey ridiculed Palmer for raising the issue and challenged him to say just what he would do about it, given his senators from Tasmania and Queensland.
So dudes, what are you going to do about it given your federal party believe that you have a duty to support the green obsessions of the Apple Isle?
The truth is that out of all the critics of the system, only the Liberal Democrats have a policy against tax transfers:
The LDP will seek to:
• Limit the federal government to defence, immigration, basic public services (eg passport services, regulation of hazardous materials, air and sea transport regulation), and assistance to the least well off.
• Stop all transfers from the federal government to other levels of government, including grants from the pool of GST revenues.