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Health deal leaves door open to GST review

The federal government has left the door open to changing the amount of GST it takes back from the states and territories as part of its health and hospital reforms.

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Source: AAP


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The federal government has left the door open to changing the amount of GST it takes back from the states and territories as part of its health and hospital reforms.

FULL DOCUMENT: National Health and Hospitals Network Agreement

All states and territories but Western Australia signed up to Prime Minister Kevin Rudd's ambitious plan on Tuesday.

Under the deal, the states will allow the commonwealth to take back an unspecified amount of GST in return for the federal government taking control of 60 per cent of hospital funding.

WA has bowed out because it rejects the need for the GST clawback. Mr Rudd will try to strike a deal with WA Premier Colin Barnett between now and July 1.

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Announcing his original plan in early March, Mr Rudd flagged the GST clawback would be around one-third of revenues.

But in the National Health and Hospitals Network Agreement, signed with the leaders that were on board with the deal, no GST amount is specified.

The agreement also states: "There will be a review of the level of GST dedicated once the system has transitioned to an efficient price."

It does, however, again commit that no state government will be worse off in the short-term and "all will be better off in the long-term".


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